Korean Crypto Exchanges Update Terms to Accept Liability for Hacks

Five South Korean crypto exchanges have been forced to update their terms and conditions to accept liability for potential hacks and service issues.

AccessTimeIconJun 17, 2019 at 8:25 a.m. UTC
Updated Sep 13, 2021 at 9:19 a.m. UTC

A number of South Korean cryptocurrency exchanges have been forced to update their terms and conditions to accept liability for potential hacks and service issues.

According to a report by the Yonhap News Agency, South Korea's antitrust watchdog, the Fair Trade Commission, said Monday that five exchanges in total had made the change after it issued a corrective recommendation.

Bithumb, an exchange that has been hacked twice in a year, is included in the five exchanges, the report says. Last June, the platform lost roughly $31 million in cryptocurrencies, and, in May 2019, a possible insider job saw around $20 million in the company's holdings of XRP and EOS disappear.

Previously the exchanges' T&Cs had stated that they would not compensate users if not found to be willfully or grossly negligent.

After it's 2018 hack, Bithumb pledged to refund users that lost cryptos, despite its T&Cs.

In January, only a third of inspected cryptocurrency exchanges got a full pass in a government security audit.

At the time, several government agencies inspected a total of 21 crypto exchanges from September to December 2018, examining 85 different security aspects. However, only 7 – Upbit, Bithumb, Gopax, Korbit, Coinone, Hanbitco, and Huobi Korea – cleared all the tests..

South Korea image via Shutterstock

DISCLOSURE

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.


Learn more about Consensus 2024, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.