Japan’s retail foreign-exchange market has largely shrugged off the cyberattack on GMO Internet Group Inc, with trading volumes holding up even if some investors are closing accounts, according to Central Tanshi FX’s Takayuki Tominaga.
Hackers threatened to leak customer data of traders using GMO’s foreign-exchange trading service unless they were paid a ransom of around US$50mil (RM203mil), the Internet services company said on Oct 27. GMO, which refused to pay, said on Oct 28 that the domain of a website hackers used to publish data had been suspended.
“The impact on trading itself has been limited, with no signs of extreme moves,” said Tominaga, the head of market operations at the Tokyo-based retail foreign-exchange broker. He hadn’t observed any large-scale withdrawals or account closures. Other traders said that they had seen some closures.
While the hacking has added to concern among Japanese policymakers over cybersecurity in general, many retail currency investors tend to hold positions for longer-term carry trades, making them resilient to short-term disruptions.
Five foreign exchange firms had reported customers affected by the GMO incident, Finance Minister Satsuki Katayama said. GMO sought government assistance to help disrupt the source of the attacks.
“Cyber risk is inherently persistent,” Tominaga said. “Even after immediate vulnerabilities are addressed, repeated attacks or follow-on disruptions could prolong the fallout.”
Some retail investors are sitting on high-yielding currency positions such as the Turkish lira and Mexican peso, having entered the market at favourable levels, Tominaga said. “That makes them less likely to unwind on the latest turmoil alone. For now, most are staying on the sidelines,” he said. – Bloomberg
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