The post Upbit Goes 99% Cold Storage after Over $30M Hack Shock appeared on BitcoinEthereumNews.com. Key Notes The leading Korean exchange plans to keep almost no funds in its hot wallets. Upbit is going far above the legal minimum of keeping only 80% of funds in cold wallets. The move will strengthen Upbit’s security but also decrease its liquidity. Upbit, South Korea’s largest crypto exchange, will move almost all customer assets into cold wallets after attackers breached its Solana hot wallets in late November. Dunamu, Upbit’s parent company, announced on Wednesday, Dec. 10, that the crypto exchange is planning to move over 99% of its digital assets to cold wallets. South Korea’s Virtual Asset User Protection Act requires all crypto exchanges to hold at least 80% of their digital assets in cold wallets. While Upbit already holds 98.33% of its cryptocurrency holdings, the exchange’s owner company aims to decrease its hot wallet holdings to below 1% after losing 44.5 billion KRW, worth roughly $31 million, to hackers on Nov. 27. According to a Coinspeaker report on Dec. 8, Upbit froze $1.77 million of the stolen funds by using its own Automatic Tracking Service, but the remaining assets seem to be lost forever. The company also noted that it will cover all losses from its own reserves and says user funds are safe. What Are the Downsides to More Security? Upbit’s move sets a new security benchmark and may push other exchanges to show and improve their own cold/hot wallet ratios. This could reduce the risk of losing large sums of digital money, as the attack surface will become very small for fraudulent actors. On the other hand, this will lower the exchange’s liquidity, with almost all funds offline, big withdrawal spikes may be slower to process, especially in stress events. If withdrawals are delayed, price gaps between Korean exchanges and global markets, the “Kimchi premium,”… The post Upbit Goes 99% Cold Storage after Over $30M Hack Shock appeared on BitcoinEthereumNews.com. Key Notes The leading Korean exchange plans to keep almost no funds in its hot wallets. Upbit is going far above the legal minimum of keeping only 80% of funds in cold wallets. The move will strengthen Upbit’s security but also decrease its liquidity. Upbit, South Korea’s largest crypto exchange, will move almost all customer assets into cold wallets after attackers breached its Solana hot wallets in late November. Dunamu, Upbit’s parent company, announced on Wednesday, Dec. 10, that the crypto exchange is planning to move over 99% of its digital assets to cold wallets. South Korea’s Virtual Asset User Protection Act requires all crypto exchanges to hold at least 80% of their digital assets in cold wallets. While Upbit already holds 98.33% of its cryptocurrency holdings, the exchange’s owner company aims to decrease its hot wallet holdings to below 1% after losing 44.5 billion KRW, worth roughly $31 million, to hackers on Nov. 27. According to a Coinspeaker report on Dec. 8, Upbit froze $1.77 million of the stolen funds by using its own Automatic Tracking Service, but the remaining assets seem to be lost forever. The company also noted that it will cover all losses from its own reserves and says user funds are safe. What Are the Downsides to More Security? Upbit’s move sets a new security benchmark and may push other exchanges to show and improve their own cold/hot wallet ratios. This could reduce the risk of losing large sums of digital money, as the attack surface will become very small for fraudulent actors. On the other hand, this will lower the exchange’s liquidity, with almost all funds offline, big withdrawal spikes may be slower to process, especially in stress events. If withdrawals are delayed, price gaps between Korean exchanges and global markets, the “Kimchi premium,”…