Only 7 Korean Crypto Exchanges Pass Government Security Checks

By Adrian Cruce

Just one third of the cryptocurrency exchanges that were inspected in Korea got the full pass, following a security audit done by the government. The ICT , Ministry of Science, Ministry of Economy and Finance and Korea Internet & Security Agency inspected 21 exchanges between the months of September and December 2018. 85 security aspects were examined.

Out of the crypto exchanges, just 7 managed to clear every single test. Those were Huobi Korea, Hanbitco, Coinone, Korbit, Gopax, Bithumb and Upbit. The other 14 exchanges were labeled as being:

Vulnerable to hacking attacks at all times because of poor security.

What is particularly worrying is that there were platforms that were identified as not having even basic network and PC security installed.

Crypto exchanges were inspected in order to check various aspects of network, system, operational and administrative security. Wallet management and database backup were also analyzed.

In the past we saw millions lost in cryptocurrencies through various hacks in South Korea. Coinrail lost over $40 million and Bithumb lost over $30 million. It was mentioned that North Korean hackers might have been behind the crypto attacks. Lazarus, an infamous North Korean hacking group, was identified as being behind the hack that led to the theft of $571 million, all in cryptos starting January 2017.

Because of the numerous security breaches that were identified, the Financial Services Commission of South Korea urged politicians to bass bills that regulate domestic cryptocurrency exchanges. The aim was to counter the lax security that is seen in the industry, especially in exchanges from South Korea.