South Korean bitcoin exchange declares bankruptcy after attack
Intrusion linked to North Korea, where stash of stolen cryptocurrency has topped US$80 million
South Korean bitcoin exchange Youbit is filing for bankruptcy after it was hacked for the second time this year on Tuesday.
The move to declare insolvency comes despite Youbit’s characterization of the attack as less severe than an intrusion last April, according to Coindesk. Users may not see full return of funds, a statement said, but the exchange will be disbursing the cryptocurrency it still has in possession.
“Due to bankruptcy, the settlement of cash and coins will be carried out in accordance with all bankruptcy procedures,” the exchange was quoted as saying in a translated statement. “However, in order to minimize the damage to our members, we will arrange for the withdrawal of approximately 75% of the balance at 4:00 am on December 19, The rest of the unpaid portion will be paid after the final settlement is completed.”
South Korean officials reportedly expressed suspicion that the attack was undertaken with support of North Korea. South Korea’s spy agency said earlier this month that the North’s stash of stolen cryptocurrency is now worth more than US$ 80 million.
Nearly 20% of global bitcoin trading takes place in South Korea, Yonhap news agency reports, fueled in part by an influx of Chinese investors following a crackdown on exchanges in China.
Seoul announced a series of new regulations, following an emergency meeting last week, including prohibiting non-residents and minors from trading in digital currencies. Chinese business news outlet Caixin is reporting Tuesday that South Korean officials are also considering another round of regulations to curb the virtual-currency hype.