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article image'Glitch' let customer purchase $2 trillion in Bitcoin for free

By James Walker     Feb 22, 2018 in Technology
The Japanese cryptocurrency exchange Zaif has reported a "system glitch" which allowed customers to purchase cryptocurrencies without paying any value in yen. During the incident, customers used the platform to buy trillions of dollars worth of Bitcoins.
The technical error occurred on February 16 but still hasn't been fully resolved. The company told Reuters it is currently working to retrieve Bitcoins which were transferred away from its exchange by customers exploiting the issue.
The "free" Bitcoin purchases were possible during a 20-minute window. At least seven customers obtained vast amounts of cryptocurrency without paying any money. One user tried to sell over $20 trillion of Bitcoins, approximately 2,200 trillion yen, before Zaif managed to block further transactions.
The "glitch" is the latest embarrassing incident that Zaif's had to face. Last month, its parent company was examined amid fears it could be vulnerable to a cyberattack similar to the Coincheck heist. Zaif is currently one of 16 cryptocurrency exchanges that is registered with the Japanese government.
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The possibility of users obtaining Bitcoins for free will put Zaif under further pressure to demonstrate the reliability of its technical systems. Exchanges aren't currently subject to detailed legislation on security and customer safety standards. Japanese regulators have taken a relaxed approach to regulation in an attempt to help the cryptocurrency sector get established in the country.
Japanese exchanges are now moving to create a self-regulatory body which will set out rules for technical resilience and security. This is intended to make trading safer for customers, theoretically minimising the risk of software issues.
The rules will also place pressure on exchanges that don't adhere to the standards, making it harder for cryptocurrencies to be traded illegally. It comes amid a wider crackdown on crypto-trading in several nations worldwide.
Zaif has said that no customers will be impacted as a consequence of the error in its automatic price calculations. The exchange has cancelled and reversed all the affected cryptocurrency purchases that were made for 0 yen per coin. Reuters reports it's still working with one customer who tried to transfer their illicitly-gained coins off the exchange.
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