South Korean regulators have launched coordinated reviews of crypto-related risks after the massive Binance theft. The Bank of Korea began surveying 18 banks and 13 brokerages on Oct. 23, with responses due by Nov. 4. It is the central bank’s first reported review of how financial institutions participate in the virtual asset market, covering a total of 31 firms, including the top five banks: KB Kookmin, Shinhan, Hana, Woori and NH NongHyup.
The questionnaire asks about crypto staffing, budgets, business activities, investments in domestic and overseas crypto companies, organizational structure and risk management practices. It also includes scenario-based questions, such as what would happen if South Korea’s largest crypto exchange suspended operations after a major hack, if crypto prices fell sharply followed by a prolonged trading slump, or if another financial institution suffered heavy crypto-related losses. The survey began before last week’s hack, but the timing highlights growing official concern.
Separately, the Financial Services Commission summoned working-level staff from five won-based exchanges — Upbit, Bithumb, Coinone, DigitalX and Gopax — plus coin-market venues such as Foblgate on Monday morning. The meeting was held to assess domestic exchange readiness after the Binance breach and came ahead of a planned financial-sector security check. Under South Korea’s Virtual Asset User Protection Act, exchanges must keep at least 80% of customer crypto deposits in cold wallets. Upbit reportedly keeps more than 99%, Bithumb about 94%, Coinone roughly 85%, and DigitalX and Gopax in the low 80s. Regulators are expected to raise those thresholds because the Binance theft targeted hot wallets.
On Oct. 29, Binance lost approximately $6.4 billion, or about 8.4 trillion won, from hot wallets across several blockchains. TRM Labs traced about $6.36 billion leaving across ten chains, most of it within about 20 minutes. The FBI linked the attack on Oct. 31 to a North Korean group it calls TraderTraitor, the same actors blamed for last year’s $1.5 billion Bybit hack. The FBI has asked exchanges and analytics firms to block linked addresses and said the thieves were converting stolen funds into ether. Binance said it had enough assets set aside to cover 90% of the missing funds and would make customers whole.
The regulatory push comes amid a broader cybersecurity crackdown. Police opened a preliminary inquiry into data thefts at Bithumb, Daishin Securities and Mirae Asset Global Investments, checking whether they are tied to earlier breaches that hit 16 firms and exposed roughly 100,000 records. The FSC previously screened 555 financial companies and flagged 130 for shortcomings. Microsoft Threat Intelligence said North Korean crews have built AI into their full operations and named crypto exchanges and financial firms as Pyongyang’s main targets, though there is no evidence AI was used in the Binance hack itself.
South Korea’s second-phase Digital Asset Basic Act remains unpassed. In February, the FSC convened an emergency meeting after Bithumb mistakenly paid out bitcoin, but a proposed strict-liability rule still has no legal footing. At an Oct. 22 parliamentary audit, Rep. Min Byungdeok noted that the U.S. passed its GENIUS Act in July 2025 and Hong Kong followed in August 2025, while Korea “did nothing.” A Bank of Korea official said, “Financial institutions are making their own preparations even as virtual asset legislation is moving more slowly than the market expected.” Nothing in the reporting indicates the current survey sets new requirements; the next date to watch is Nov. 4.
