Earlier in the week Japanese cryptocurrency exchange Coincheck was hacked and reported $534 million worth of NEM was stolen. Coincheck has remained apologetic and assured users they will receive compensation in JPY if funds are unable to be recovered. The NEM team has been extremely proactive in finding a solution that would avoid conducting a hard fork to devalue the stolen NEM. Thankfully, the NEM developers created an automated tagging system that will enable the tracing of the stolen NEM so exchanges are aware to not allow withdrawals.
“Hack update: NEM is creating an automated tagging system that will be ready in 24-48 hours. This automated system will follow the money and tag any account that receives tainted money. NEM has already shown exchanges how to check if an account has been tagged. So the good news is that the money that was hacked via exchanges can’t leave,” -NEM Team.
This news come as a big relief to victims of the hacking as recovering funds in past exchange hackings usually account in unrecoverable funds. The NEM team deserves all the credit considering the fault was on Coincheck’s security system rather than the NEM block chain. At this point the thieves have no other options besides hodling on to the stolen NEM. It is unclear how the exact recovery process will take place. The tagging system will be a great deterrent to hack jobs as it leaves fewer options for thieves to turn to after stealing funds.