Japanese regulators swooped on the offices of Coincheck on Friday morning to undertake reviews of the Tokyo-based cryptocurrrency exchange's computer networks following the theft last week of millions of dollars of digital currency.
Financial Service Agency (FSA) officials said they had demanded that known flaws in Coincheck's network be fixed in the weeks before hackers stole $530m, yet the exchange was allowed by the regulator to continue operating on a provisional licence pending registration.
The raid on Coincheck's offices was launched at 8am in Tokyo, with the purpose of observing the company's response to the theft, its efforts to compensate customers and review governance at the exchange, which remained closed seven days after the hacker's attack.
Coincheck has said it would compensate the 26,000 or so customers who lost their NEM token holdings from a so-called "hot wallet".
No funds have yet been reimbursed and part of the FSA raid was to establish if Coincheck had made any effort to begin the process - also to establish if, indeed, Coincheck has sufficient funds for the reimbusement.
The regulator gave Coincheck until 13 February to make its report on the events and to show how it intends to repay customers and improve its security.
FSA officials have also demanded that every other crypto-exchange in Japan report on potential risks to their systems. There are currently 16 exchanges operating with full authorisation, while another 15 - like Coincheck - operate under provisional terms.
Meanwhile, the NEM Foundation - the Singapore-based blockchain platform that operates distribution of the NEM cryptocurrency led by Lon Wong (left) - said that no attempt to sell the stolen tokens had yet been made.
The company said in a statement: "None of the stolen funds have been sent to any exchanges. As long as those funds are off public exchanges they will be very difficult to liquidate, especially in large amounts."
On Friday morning, exactly a week after the Coincheck hack, all the major cryptocurrencies were falling sharply. Bitcoin fell below the $10,000 level where it had hitherto been finding buyer support and hit $8,800 - down 13.75%.
NEM - the virtual currency stolen in the Coindesk hack - was down 29.93% at $0.563 on Friday. It had stood at around $0.81 when the hack occurred.
Ethereum lost 18.3% to $936.33, while ripple shed 26.39% to $0.822 and Litecoin slid 22.55% $125.26.