A recent glitch at Japanese cryptocurrency exchange Zaif created a situation that caused an error with its price calculation system. As a result, some users were able to buy digital currencies for free. One of the parties allegedly “bought” $20 trillion in Bitcoin for zero dollars.
The issue was discovered on February 16 and publicly announced on Zaif’s website February 20. The exchange did not specify which cryptocurrencies were affected. All of the transactions took place during a 20-minute window. Zaif said there will be no impact on customers.
Seven users bought some digital coins for zero yen. The company said that six of the transactions have been voided and that it is trying to rectify the issue with the seventh customer. None were able to profit from the mistake.
Last year, Japan rolled out the world’s first system to oversee cryptocurrency exchanges to stamp out illegal uses of cryptocurrencies and protect customers. Zaif is run by Tech Bureau Corp. and is one of the 16 exchanges registered by the government. Another 16 have been allowed to continue operating pending full registration.
Japan has been quite open to cryptocurrencies, while countries like China and South Korea have taken a tougher stance. Japanese merchants began accepting bitcoin as a payment method last year. However, the rules for the industry were relatively loose to avoid hampering start-ups in the market. Now, some are wondering if those rules are too loose.
This is just the latest in a long line of issues that have heightened concerns over the values of various cryptocurrencies and the security of the trading platforms. Bitcoin surged more than 1,300 percent last year, but lost about half its value at one point this year. Japanese exchange Coincheck had over $500 million of cryptocurrency stolen last month.
Japan has emerged as one of the biggest markets for cryptocurrencies in the wake of other countries’ crackdowns. Because the industry is so new, cryptocurrency traders and exchanges will need to solve problems as they come up.