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South Korean crypto exchange Upbit will move 99% of customer assets to offline cold storage after hackers stole approximately $30 million from its Solana hot wallets.
Operator Dunamu said the new policy exceeds South Korea’s 80% cold storage requirement and will reduce online wallet exposure “to effectively zero” following the breach.
“The top priority is protecting user assets,” Dunamu said in a statement, emphasizing that Upbit wallet security will now anchor its operational strategy, even if it slows the speed of withdrawals or asset movements.
Cold wallets fully offline are far more resistant to hacks but require additional steps to execute transactions. Hot wallets remain connected to the internet, enabling instant withdrawals yet exposing digital assets to attack vectors.
Before the breach, Upbit wallet security already featured the lowest hot-wallet share among major Korean exchanges, with just 1.67% of funds online as of October 2025. Rivals maintained online exposure between 10%–18%, according to figures disclosed by lawmaker Heo Young.
Dunamu confirmed that despite increased trading volumes, Upbit wallet security reforms now allow the platform to operate without relying on live wallet balances for liquidity. All major internal systems have been reviewed, upgraded, and hardened to reduce any risk pathway tied to hot wallets.
One security strategist familiar with major crypto infrastructure commented:
“This is one of the most aggressive cold-storage policies globally. Upbit is making wallet security a competitive differentiator.”
The catalyst for this shift was a theft of 44.5 billion KRW (≈$30 million) from a compromised Solana wallet. Initially reported above $36 million, the final figure was lowered following an on-chain review.
Of that amount, about 38.6 billion KRW (≈$26.2 million) involved direct user losses, which Dunamu has pledged to cover entirely from company reserves which is a move signaling confidence in its financial capability and commitment to restoring Upbit wallet security reputation.
Affected assets included SOL, ORCA, RAY, and JUP tokens. Immediately after detecting abnormal withdrawals, the exchange:
Internal engineering assessments highlighted that attackers may have exploited weaknesses in the interface connecting Upbit’s wallet systems to public Solana blockchain data is a reminder of the ongoing challenge in maintaining Upbit wallet security against emerging vectors.
A Dunamu spokesperson added:
“The response is about more than a patch as it is about eliminating systemic risk tied to hot wallets entirely.”
The breach has also fueled national regulatory discussions. The Financial Services Commission is considering requirements that would enforce bank-grade responsibility on digital-asset platforms including mandatory compensation in hacking cases regardless of fault.
Legal analysts say that if implemented, such reforms would force exchanges to adopt Upbit wallet security-style models, not only to prevent losses but to demonstrate sufficient reserves for client reimbursement.
The regulatory shift could:
Analysts believe Upbit wallet security investments help it remain compliant with tougher oversight, giving the platform a competitive edge as the market moves toward institutional-level consumer protection.
The industry is watching how customers respond to delayed withdrawals that may result from ultra-cold storage policies. But Dunamu appears willing to prioritize airtight Upbit wallet security over friction-free convenience especially amid heightened scrutiny in South Korea’s rapidly growing crypto trading sector.
By achieving a 99% cold storage ratio, Upbit is signaling that digital assets will not sit online long enough to become easy prey for hackers. The move marks a decisive shift away from operational speed toward a fortress-style defense model.
If trust was shaken by the attack, Upbit wallet security reforms aim to rebuild it is one offline coin at a time.
