Japanese DMM Bitcoin To Raise $320M for Post-Hack Recovery

DMM Bitcoin, a Japanese crypto exchange recently hacked for $320 million in Bitcoin, aims to raise 50 billion yen ($320 million) to reimburse affected users

DMM Bitcoin disclosed in a June 5 statement that it would obtain an equivalent quantity of Bitcoin from its parent company, DMM.com, to reclaim any misappropriated customer funds.

Ongoing inquiry

DMM Bitcoin guaranteed users that it would “take care” to mitigate the market impact of the planned purchases in the statement.

Following the “unauthorized outflow” equivalent of 4,503 BTC on May 31, the company also disclosed that its investigation is still ongoing.

DMM Bitcoin expressed its “heartfelt” apologies for the situation and its impact on its clients, and it pledged to “persist in the investigation of the unauthorized outflow.”

The company also declared that it would promptly notify the public of any new information as soon as it surfaced.

Acquiring recovery funds

On June 3, DMM Bitcoin borrowed five billion yen ($32 million) to finance the compensation necessary to reimburse consumers.

June 7 will see an additional 48 billion yen ($308 million) in capital increase, and June 10 will see an additional 2 billion yen ($12.8 million) in subordinated debt financing.

DMM.com provides this financial support and recovery fund accumulation and will guarantee the requisite funds to “uphold customers’ Bitcoin holdings.”

Reduced to “bits”

The DMM Bitcoin incident is one of the top 10 most significant crypto exchange breaches of all time, and it is ranked as the eighth-largest cryptocurrency hack in history.

The Ronin Network breach of March 2022, which resulted in the theft of $620 million, was the first to exploit the network’s validator nodes.

This prompted Ronin to enhance their security measures substantially, introduce $1 million bug bounties, and double their validator nodes to prevent it from reoccurring.