Currently, the crypto exchanges at South Korea hold worth of $1.9 billion cryptocurrencies within their accounts. Recent inspections recognize 14 previous investigating exchanges to be vulnerable to hacking at these times due to poor security.
Also, Ministries of science & finance together with the Korean Internet and Security Agency (KISA) inquiries has been conducting since September – December 2018.
As per the latest inspection, the governments’ authorities are in charge to check out an investigation regarding the pinpoint issues occurring in previous inquiry accomplishes. Moreover, 21 new platforms list under scrutiny within similar guidelines.
Additional to the existing exchanges that were not able to enhance their security process, there are more 17 crypto exchanges that still lacks behind some proper arrangements. Few of them include:
- Dedicated security with management staff
- A password management system
- Crypto deposit and withdrawal controls
- System to manage their crypto wallets
The authorities also clear that 7 crypto venues under previous audition in September incorporates possible adjustments within their systems. Moreover, they hold an entire certification on 85 security items. The government reveals some big names in a statement:
- Huobi Korea
South Korean Regulatory Approach
The current cryptocurrency exchanges ongoing in South Korea classify as information providers instead of financial institutions. Therefore, they come under the Ministry of Science jurisdiction in Korea instead of financial regulators.
However, looking at the government criticism for not taking many precautions to prevent attacks and hacks, the Financial Supervisory Service (FSS) specifies back in October that they will explore their inquiry on accounting practices regarding giant cryptocurrency exchanges.
Meanwhile, this announcement was just after the prosecutor introduces an investigation relating the corporate accounts use by crypto venues. The regulators believe that this might lead to money laundering.
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