Korean Authorities Claim Binance Froze Only a Fraction of Upbit Hack Funds
Korean authorities have revealed that Binance, a leading cryptocurrency exchange, has only frozen a small portion of the cryptocurrencies stolen in last month’s Upbit hack, despite urgent pleas from police and the exchange to stop the movement of illicit funds. According to investigators, only 17% of the assets marked for freezing were actually frozen, local news outlets reported Friday.
Security analysts tracking the breach say the hacker group behind the attack on the morning of November 27th employed a sophisticated money laundering strategy and quickly distributed the stolen assets across more than a thousand wallets. The attackers repeatedly divided the funds into smaller portions, moved them through multiple chains, and relied on token bridges and swaps to cover the trail.
Binance’s Response to the Hack
According to authorities, most of the laundered assets ended up in service wallets on Binance. Upbit and the police called for an immediate freeze on Solana, worth about 470 million won (about $370,000), which was confirmed to have hit Binance. However, the exchange only froze 80 million won (approximately $75,000), saying additional verification was needed before more comprehensive action could be taken.
The freeze was confirmed around midnight on the day of the incident, about 15 hours after the original request. When asked by Korean broadcaster KBS about the limited scope of the freeze and delay, Binance declined to go into details, citing its policy regarding active investigations. The exchange said only that it “continues to work with relevant authorities and partners in accordance with appropriate procedures.”
Expert Opinion and Recommendations
This explanation did not satisfy experts in South Korea. Cho Jae-woo, director of Hansung University’s Blockchain Research Institute, argued that quick intervention is essential to minimize losses. “To prevent damage from hacking, a quick initial freeze is essential, but exchanges often cite the risk of litigation as an excuse for their hesitation,” he said.
He added that the industry should consider establishing a global emergency hotline between exchanges or a coordinated body with the authority to impose immediate freezes in crisis situations. Investigators say most of the stolen assets have now been converted from Solana into Ethereum, a move likely aimed at improving liquidity given Ethereum’s deep markets.
As reported, Upbit is moving nearly all of its customer assets into cold storage after hackers stole 44.5 billion won (about $30 million) from its Solana hot wallet, marking one of the strongest security responses by a major exchange to date. Operator Dunamu said the platform will increase its cold wallet ratio to 99% and reduce hot wallet risk to virtually zero, well above South Korea’s legal requirement that 80% of user funds be stored offline.
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