Following the alleged hacks of South Korean crypto exchanges, the government has formally launched an investigation into the cause of the hacks. The authorities will also perform security checks on all crypto exchanges’ systems.
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Government’s Response
The South Korean government announced on Wednesday, June 20, that it has formally launched an investigation into the cause of the alleged security breaches at two crypto exchanges, Bithumb and Coinrail. At the time of this writing, Bithumb is the country’s second-largest crypto exchange by volume, behind only the Kakao Corp-backed Upbit, according to Coinmarketcap. Coinrail is the country’s seventh largest crypto exchange.
The government’s notice states:
The Ministry of Science and Information and Communication Technology (hereinafter referred to as ‘Science and Technology Ministry’) and the Korea Internet & Security Agency (KISA) said that they are investigating the cause of the accident caused by the virtual currency leak that occurred in Coinrail and Bithumb.
So far, the authorities have not confirmed that the two exchanges were hacked. Coinrail announced on June 10 that it was hacked with an estimated loss of approximately $40 million. Just 10 days later, on June 19, Bithumb revealed that approximately $31 million worth of its cryptocurrencies was stolen.
Investigating Security Breaches
In its announcement, the Korean government explained:
As soon as a company reports a hacking incident, a KISA accident investigation worker is quickly on the scene and is investigating. In cooperation with the police, the agency will analyze and respond to the cause of the accident.
The Science and Technology Ministry inspected the level of information security of 21 cryptocurrency exchanges from January to March this year. After discovering that “most
