- Dunamu, the firm behind Upbit, emphasized that since that incident, they have implemented various measures to prevent recurrence.
- South Korea’s virtual asset market continued to thrive in the first half of 2023.
South Korea’s leading cryptocurrency exchange, Upbit, faced 159,061 hacking attempts during the first half of 2023, marking a significant surge compared to previous years.
According to data provided by Dunamu, the company that owns and operates Upbit, there was a 117% increase in hacking attempts from the first half of 2022 and an astounding 1,800% surge from the same period in 2020.
The progression of hacking attempts on Upbit has been notable, escalating from 8,356 cases in the latter half of 2020 to 87,242 cases in the first half of 2023. This surge is concerning, given Upbit’s substantial daily trading volume of over 2 trillion won.
Upbit’s history with hacking incidents includes suffering approximately 58 billion won in damages from a hacking attack in 2019. However, Dunamu, the firm behind Upbit, emphasized that since that incident, they have implemented various measures to prevent recurrence.
These measures include distributing hot wallets and operating them.
They also disclosed a strategy of maintaining over 70% of assets in cold wallets to enhance security. Cold wallets, which store private keys offline on external devices, are less susceptible to hacking compared to hot wallets, which store keys online.
An alarming surge in cyberattacks
Representative Park Seong-jung of the National Assembly’s Science, Technology, Information, Broadcasting, and Communications Committee stressed the severity of hacking incidents targeting major exchanges like Upbit.
He noted that despite the increasing frequency of virtual asset hacking, the role of the Ministry of Science and ICT in managing and supervising these matters remains unclear.
Seong-jung called for comprehensive white mock hacking tests and assessments of information security conditions to prepare for cyberattacks targeting virtual asset exchanges and critical sectors like hospitals and subways.
South Korea continues attracting investments
Despite the ongoing hacking attempts, South Korea’s virtual asset market continued to thrive in the first half of 2023, with a total market cap of $21.1 billion. This represented a 46% increase compared to the previous six months, according to the Financial Services Commission (FSC).
South Korean virtual marketplace operators reported an impressive 82% rise in operating profits, totaling $168 million, while deposits in crypto exchanges increased by 11% to approximately $3 billion.
The market also witnessed the trading of 622 types of cryptocurrencies, with 169 new coins listed, although 115 coins experienced trading suspensions for various reasons.
This surge in the virtual asset market is particularly noteworthy given the decline in the number of individual and corporate crypto traders, which decreased by 210,000 to 6.06 million by the end of June.
Traders in their 30s constituted the largest segment, with over 67% holding virtual assets valued at less than 500,000 won.
Despite a slight dip in the average daily transaction value at the 26 exchanges, decreasing by 1.3% to $2.1 billion in the first half of the year, the overall growth of the market suggested a resilient and expanding virtual asset landscape in South Korea.
