Coincheck hackers attempting to sell stolen cryptocurrency: executive

Hackers behind last week's $530 million UScryptocurrency heist one of the biggest ever have started to move and are trying to sell some of the stolen "XEM" coins, the vice president of the foundation behind the digital currency said on Tuesday.

Jeff McDonald of the NEM Foundation, creators of the XEM cryptocurrency, said he had traced the stolen coins to an unidentified account, and that the account owner had begun trying to move the coins onto six exchanges where they could then sell them.

The location of the account was not yet known and McDonald could not immediately confirm how many of the stolen coins had been spent.

"[The hackers are] trying to spend them on multiple exchanges. We are contacting those exchanges," Singapore-based McDonald told Reuters.

NEM Foundation spokeswoman Alexandra Tinsman said the hacker had also started sending out "XEM" coins to random accounts in 100 XEM batches, worth about $83 US each.

McDonald said the hackers were unlikely to spend anything close to all of the stolen cryptocurrency because the "market simply couldn't absorb that much".

Hackers made off with roughly 58 billion yen ($532.6 million US) from Tokyo-based cryptocurrency exchange Coincheck Inc late last week, raising big questions about security and regulatory protection in the emerging market.

There have been at least three dozen heists of cryptocurrency exchanges since 2011; many of the hacked exchanges later shut down. More than 980,000 bitcoins have been stolen, and few have ever been recovered.

In 2014, Tokyo-based Mt. Gox, which once handled 80 per cent of the world's bitcoin trades, filed for bankruptcy after losing bitcoins worth around half a billion dollars then the biggest ever such heist.

XEM is the world's 10th biggest cryptocurrency. As of 3:57p.m. ET, XEM was trading at 80.6 cents USper coin, according to trade website Coinmarketcap, with a total market value of around $7.26billion US.

Tough to trace

McDonald said that once the hackers had moved the coins to an exchange, they were likely to try to exchange them into another cryptocurrency before transferring the coins back into a traditional currency. That would make the funds difficult or near impossible to trace.

"I would assume that they are going to get away with some of the money," McDonald said.

Japan's Financial Services Agency (FSA) on Monday ordered improvements to operations at Coincheck, which on Friday suspended trading in all cryptocurrencies except bitcoin.