Japanese crypto exchange DMM Bitcoin is gearing up to raise 50 billion yen ($321 million) to compensate customers after a significant hack. This funding will be used to buy Bitcoin, ensuring that clients are made whole.
DMM Bitcoin assured that their Bitcoin purchases would be conducted carefully to avoid market disruptions in a statement on Wednesday. The investigation into last week’s “unauthorized outflow” of 4,503 Bitcoin, equivalent to $320 million at Bitcoin’s market price of $71,000, is still ongoing.
This incident ranks as the seventh-largest crypto hack ever, according to blockchain analysis firm Chainalysis. In response, Japan’s Financial Services Agency has mandated DMM Bitcoin to report on the hack’s causes and their customer compensation strategy. Finance Minister Shunichi Suzuki also emphasized the government’s commitment to preventing future security breaches at crypto exchanges.
According to a Bloomberg report, to kickstart the recovery, DMM Bitcoin has already borrowed 5 billion yen. The exchange plans to secure an additional 48 billion yen through a capital increase and 2 billion yen via subordinated debt financing, both from other companies within the DMM.com Group.
DMM Bitcoin is part of DMM.com, a multifaceted enterprise established in the late 1990s. This group encompasses over 20 companies with a combined revenue of approximately 348 billion yen in the year ending February, according to its website.
DMM.com Group’s CEO, Keishi Kameyama, oversees a diverse portfolio of businesses, including video streaming, anime production, foreign exchange, stock trading, solar energy, 3D printing, and even the manufacturing of fire trucks and ambulances. Additionally, the group manages a Belgian soccer team.
Given that the fundraising involves other DMM.com Group companies, it’s challenging for outsiders to evaluate the plan, noted Yuya Hasegawa, a market analyst at Bitbank Inc., a fellow crypto exchange operator.
Also Read: Binance User Lost $1 Million to Crypto Hack via Chrome Plugin
