The recently hacked Japanese cryptocurrency exchange Zaif has finally been taken over by Osaka-based Fisco Cryptocurrency Exchange (FCCE).
Getting hacked is almost always a nail in the coffin for cryptocurrency exchanges, and Zaif hasn’t been much of an exception. In the past, when exchanges like Mt. Gox and BitGrail were hacked, it eventually led to their closure while in the case of Coincheck and Bithumb the result was an acquisition.
Although the formal announcement was made yesterday, Zaif is being operated by FCCE since November 22. Zaif will continue to be operated on both FCCE and Zaif as separate platforms, the announcement said.
Following the hacking of Zaif in September of 2018 that lost the exchange around $62 million (est. 438 crore INR), Fisco had announced financial support of 5 billion Japanese Yen to the exchange. In return, Zaif agreed to enter into a “capital alliance” with Fisco that ultimately allowed the exchange to acquire a majority stake in Zaif.
The acquisition has resulted in some internal readjustments, resulting in the cessation of some of the services provided by the exchange. Users of the exchange were asked to consent to the migration of their assets if they wanted to keep using their services.
Their website says:
The administration of the site has changed to Fisco Cryptocurrency Exchange Inc … We request that all users who have not given their acceptance to the migration of their contract in the Transfer of Business to complete the consent procedures.
Users who have agreed to the migration will be allowed to keep using the exchange while users who didn’t will have no choice but to shift to other crypto exchanges. Since the hack resulted in the loss of deposits of BTC, BCH, and MONA, their trading is still in suspension, adding to a list of other currencies whose withdrawals have been put on hold.
Zaif was one of the sixteen cryptocurrency exchanges licensed and regulated by the Japanese Financial Services Agency (FSA). Following the hack, the Agency was reportedly considering canceling the license of the crippled exchange.
As is evident from all of this, the takeover has resulted in Zaif operating with a handicap, which might cause some of its users to go looking for greener pastures.