Crypto Exchange Upbit Has Ethereum Stolen. Stolen Assets On the Move

Upbit, one of the largest cryptocurrency exchanges in South Korea, had 342,000 Ethereum stolen last week. Hacker(s) spread out the funds by sending chunks of little over 1,000 to an anonymous wallet today, valued at about $1.65 million.  It is reported that the wallet theft this time an internal staff rather than an external hacker.

Upbit is held by Kakao, a large South Korean technology company. Last Wednesday (November 27), it was confirmed that an investor’s wallet was stolen, involving about 394 million yuan in funds ($49 million USD). The criminals suspected that the ether in the stolen wallet will be transferred to an anonymous account today. There were 11,001 ethers transferred to other accounts at least 6 times. At the same time, EtherScan, a website that tracks the flow of ether, has raised a red flag, indicating that these transactions are from the “Upbit Hack.”

Upbit has previously promised to compensate all victims for all losses, and Zhao Changpeng, chief executive of Binance, another large exchange in the cryptocurrency industry, also stated that it will ensure that stolen Ethereum will not be on the Binance Exchange. As mentioned before, the market suspected that Upbit’s internal staff had stolen customer assets due to the time of the event. It happened when the exchange transferred the cryptocurrency from the online wallet (hot wallet) to the offline wallet (cold wallet) for storage.

Upbit, Korbit, Bithumb and Coinone are the four major South Korean exchanges, but only Upbit recorded a profit of 686 million yuan (~$97 million USD) last year. The four exchanges have established a hotline together as early as January last year to ensure that any suspicious transactions can be detected and immediately frozen.