Back in May, UPbit’s headquarters in South Korea were raided following allegations that it wasn’t holding enough money in its accounts to cover investor deposits. Following the raid where hardware was taken away for examination, the global crypto markets began to plunge – possibly linked to the fear created by the investigation. During the period where UPbit was under scrutiny, a multitude of other South Korean crypto exchanges were hacked, and many feared UPbit would become a victim as well. Fortunately, UPbit has survived the attacks so far, with it also now seeing a positive result to its criminal investigation.
UPbit Gets the All Clear
South Korean regulators employed the help of Yoojin – a top Korean accounting firm – who revealed that the exchange was breaking no laws and held more than enough money to compensate every investor using the platform. In light of the incident, UPbit has decided to regularly release reports to prove its solvency. This is a major step for the exchange, and will go some way to restoring Korean investor confidence in the crypto trading platform.
South Korea Hit by Hackers
It hasn’t been an easy year so far for the South Korean crypto exchanges, with multiple hacks, exchanges folding, and police raids all hurting the nation’s crypto standing. Back in December, Youbit filed for bankruptcy following a second attack, which wiped out 17% of its balance sheet. In addition to this, Bithumb was hacked in June, which led to investors funds being frozen, while Coinrail lost almost $40 million to hackers. Hacks are becoming more commonplace within the crypto exchange world, which is causing a lot of fear and uncertainty in the markets. Exchanges need to step up their security measures – possibly by implementing a bug bounty system – to keep their user’s funds safe.
South Korea Turning Crypto-Friendly
It appears as if South Korea is heading down a similar route to Malta with its new crypto classifications. The South Korean government took a tough stance against the crypto world earlier in the year, and this is part of the reason for the investigation into UPbit. Since then, the government appears to have softened its stance towards cryptos and is starting to move in favor of them by regulating the space. Back in July, Malta passed three crypto-friendly bills into law, paving the way for the first crypto-island. South Korea looks set to follow Malta in becoming a crypto haven, with regulations that protect investors and help crypto-focused companies to grow safely.
The crypto space is still growing, especially in South Korea. While it is still reeling from the recent spate of attacks, the South Korean crypto market is beginning to recover, which is certainly a positive sign. South Korea still has a long way to go before it reaches its heights of Japan, but it’s certainly making huge strides in that direction.