Cryptocurrency investors file lawsuit against Coincheck Inc

While Coincheck wants to resume trading once it can guarantee the secure resumption of its operations, investors want to withdraw their holdings so that they can continue trading on other cryptocurrency exchanges.

On Thursday, cryptocurrency investors in Japan launched a lawsuit against Tokyo-based cryptocurrency exchange Coincheck Inc in efforts aimed at forcing it to allow them to withdraw assets worth $183,000 which were frozen after last month’s $530 million heist.

A group of seven investors have filed a lawsuit at the Tokyo District Court, requesting that Coincheck pay annualized interest of 5% on the value of the digital coins from notification of the claim until it resumes withdrawals.

On Tuesday, when Coincheck restarted withdrawals, it saw a single day outflow of $373 million.

Coincheck has stated it will continue to curb withdrawals of cryptocurrencies until it can guarantee the secure resumption of its operations.

“I‘m hoping (Coincheck) will respond quickly and let us resume withdrawals,” said one of the plaintiffs on condition of anonymity.

One of the plaintiff, a man in his 20s, who had invested 400,000 yen in crypto currnecy at Coincheck said, he will not cease to trade in cryptocurrencies and nor is he concerned about their security.

“I think their value will increase,” said the plaintiff. “I’ll look for a safer place to invest.”

The January 26 Coincheck hack, one of the biggest in cryptocurrency history, underscores growing regulatory and security concerns about bitcoins and other cryptocurrencies in the midst of a global boom, which shows little signs fizzling down, in these assets.

The heist, also drew into focus, Japan’s rush to create a system that overseas this new age industry.

Japan, the world’s third largest economy, is the first country to draw up rules around cryptocurrencies.

According to Hiromu Mochizuki, the lawyers of the plaintiffs, they plan on filing a second lawsuit on February 27, for loss of value of their frozen digital money as well as other damages stemming from the curbs on withdrawals.

As of Tuesday, February 13, 2018, the value of the group’s frozen assets, spanning 12 virtual currencies, was worth $183,047 (19.5 million yen), according to a court filing.

Court documents also state, this value has slumped to 8.9 million yen, a fall of 31.3%, between date of the heist and Tuesday.

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