Japan's DMM Gets Biz Improvement Order over Bitcoin Loss

Tokyo, Sept. 26 (Jiji Press)--Japan's Financial Services Agency on Thursday issued a business improvement order to cryptocurrency exchange DMM Bitcoin Co. for having 48.2 billion yen's worth of customers' bitcoin deposits stolen in May.

Based on the payment service law, DMM Bitcoin was ordered to identify the cause of the loss, strengthen its system risk management structure and clarify who is responsible. The FSA also told the Tokyo-based company to submit a business improvement plan by Oct. 28.

DMM Bitcoin detected the unauthorized outflow of the deposits May 31. The agency responded by ordering the company to submit a report.

The company then suspended some services, such as cryptocurrency trading and opening of new accounts. It also raised the amount of bitcoin equivalent to what was lost, with support from its group, led by DMM.com LLC.

The agency's investigation into DMM Bitcoin found that system operation and security management authorities were concentrated on some people. The company also operated business in ways violating the agency's guidelines, including by failing to store private keys in a decentralized manner.

[Copyright The Jiji Press, Ltd.]