Upbit Experienced a 117% Increase in Hacking Incidents in the First Half of 2023

Upbit, a cryptocurrency exchange based in South Korea, encountered over 159,000 hacking attempts in the first half of 2023, according to its parent company, Dunamu. This number marks a considerable increase, reflecting a 117% rise compared to the same timeframe in 2022 and an extraordinary 1,800% jump relative to the first half of 2020.

As one of the largest cryptocurrency exchanges in South Korea, Upbit boasts a notable 24-hour trading volume of around $1.2 billion, as indicated by CoinGecko. Other major players in the South Korean exchange market include Bithumb, Coinone, and Gopax.

Upbit Enhanced its Security Protocols

In light of the increase in attempted security breaches, Dunamu disclosed that the exchange has strengthened its security protocols. This includes raising the percentage of funds kept in cold wallets to 70%, thereby enhancing its security framework. Furthermore, Upbit has adopted improved security measures for the funds maintained in hot wallets.

In 2019, Upbit experienced a $50 million exploit. Following this hacking incident, a representative from Dunamu stated to Yonhap that the company instituted various strategies to avert a similar occurrence, which included the distribution and management of hot wallets.

To date, there have been no reported cyber breaches. It is important to note that hot wallets, which keep private keys online, are more vulnerable to hacking compared to cold wallets, where private keys are stored on external devices such as hard drives and USBs.

Nonetheless, Upbit encountered a challenge in late September when it had to halt services for the Aptos token. This was due to the platform’s inability to identify a counterfeit token named “ClaimAPTGift.com,” which managed to infiltrate 400,000 Aptos wallets.

Increase in Crypto Hacks in South Korea

Seong-jung recognized the rise in cryptocurrency hacks and called on the South Korean government to take more assertive measures.

He stressed the necessity for the Ministry of Science and Technology to perform comprehensive cybersecurity assessments and evaluate the information security preparedness of virtual asset exchanges, especially given the frequent hacking attempts. He also highlighted the unclear role of the Ministry of Science and ICT in supervising and managing these exchanges.

In a series of attacks during September, multiple crypto exchanges were targeted. CoinEx, based in Hong Kong, suffered a $70 million hack after one of the company’s private keys was compromised. The firm assured users affected by the breach would receive compensation for their lost funds. Additionally, Huobi Global’s HTX exchange faced a $7.9 million loss due to an exploit on September 24.

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