South Korea”s leading cryptocurrency exchange, Upbit, has reported a substantial loss estimated between $36 million and $37 million due to a security breach affecting its Solana network hot wallet. The unauthorized withdrawals occurred early Thursday morning, around 4:42 AM local time, prompting immediate action from the exchange.
Shortly after detecting irregular transfers, Upbit suspended all deposit and withdrawal services and moved its remaining assets from the Solana network into cold storage to mitigate further risks. The breach compromised various tokens, including notable assets like BONK, JTO, SONIC, and USDC, alongside numerous Solana-based digital currencies.
In a statement, Dunamu CEO Oh Kyung-seok confirmed the exchange”s commitment to fully compensating the affected users using corporate assets. The exchange has taken proactive measures by collaborating with law enforcement and has successfully frozen around $8.3 million worth of Solayer tokens.
The compromised funds were traced to external wallet addresses that were not part of Upbit”s authorized infrastructure. Following the breach, Upbit engaged its security team to conduct a thorough audit of its digital asset transfer systems to identify potential vulnerabilities that may have led to this incident.
In an effort to recover assets, Upbit is working closely with token issuers to freeze affected assets on-chain where feasible. The exchange has urged users to report any suspicious activities through its customer support channels as the investigation unfolds.
All deposit and withdrawal services will remain halted until a comprehensive security review is completed. Upbit has not provided a timeline for when normal operations will resume, emphasizing the importance of ensuring all systems are secure before resuming services.
This security incident occurs amid significant corporate changes at Dunamu, with the company undergoing a $10.3 billion stock-swap agreement to be absorbed by Naver Financial, marking one of the largest restructuring events in the company”s history. As South Korea”s largest cryptocurrency exchange by trading volume, Upbit serves millions of users navigating the dynamic crypto trading landscape.
