Anime Giant Kadokawa Reportedly Paid Nearly $3 Million in Ransom to Russian Hackers

Kadokawa Corporation, one of Japan’s most influential media and entertainment companies, has come under scrutiny after reports surfaced claiming the company paid $2.98 million in cryptocurrency to the Russian-linked hacker group BlackSuit. The payment was allegedly made following a ransomware attack earlier this year, which compromised vast amounts of sensitive company data.

The cyberattack, which occurred on June 8, 2024, targeted Kadokawa’s servers, including those operated by its subsidiary Dwango Co., best known for running the video-sharing platform Niconico.

The attack rendered services inoperable and encrypted 1.5 terabytes of data, including sensitive company documents and personal information of employees. The hackers initially demanded $8.25 million in ransom, but negotiations reportedly led to a reduced payment of $2.98 million.

Emails allegedly sent by BlackSuit to Kadokawa executives confirmed receipt of the payment in cryptocurrency. These communications were leaked by an anonymous source within Kadokawa and were later corroborated by a separate investigation.

Online records reviewed by the security firm Unknown Technologies revealed a cryptocurrency transaction in mid-June that matched the ransom amount.

Despite the payment, BlackSuit proceeded to release portions of the stolen data on the dark web. This included confidential contracts and employee records, further escalating the company’s troubles. Kadokawa has not publicly commented on the payment or the specifics of the attack, citing ongoing investigations.

Kadokawa’s role in the entertainment industry is immense. It has produced some of the most iconic anime and light novels, including Sword Art Online, Re:Zero – Starting Life in Another World, Konosuba, Overlord, and The Rising of the Shield Hero.

Additionally, its subsidiary Niconico is one of Japan’s largest video platforms, serving as a hub for fan-driven content and live-streaming events. This attack not only disrupted its operations but also raised concerns about the security of intellectual property tied to its globally popular franchises.

The fallout from the incident has been significant. Employees have criticized Kadokawa’s lack of transparency in handling the crisis, particularly the absence of a press conference or a clear explanation of how their data was leaked.

Kadokawa is reportedly facing financial repercussions from the attack, having projected a loss of 2.3 billion yen (approximately $15 million) for the fiscal year ending in March 2025. Meanwhile, rumors of Sony’s potential acquisition of Kadokawa have gained traction, with many employees expressing optimism about a possible change in leadership amid frustrations with the current administration.

Source: KYODO NEWS ENG