South Korea's largest cryptocurrency exchange, Upbit, has temporarily suspended deposits and withdrawals after discovering a significant breach of approximately $36 million from a hot wallet on the Solana network. The timing of this incident coincided with Upbit’s announcement of a major acquisition deal worth $10 billion with fintech giant Naver. The exchange is taking steps to secure assets and reassure users that their funds will be safeguarded.

Key Takeaways

Upbit froze deposits and withdrawals after a $36 million breach from its Solana hot wallet.
The exchange confirmed that cold wallets remain secure and will cover user losses.
A full security review is underway, with trading remaining operational.
The incident occurs just as Dunamu, Upbit's parent company, finalized a $10 billion acquisition with Naver.

Upbit hit with $36M Solana hot wallet breach day after $10B Naver deal

Upbit Freezes Transactions Due to Security Breach

On Thursday, South Korea’s Upbit exchange froze its deposit and withdrawal services after detecting unauthorized transactions amounting to around $36 million from its Solana hot wallet. The suspicious activity was noted at approximately 4:42 am local time (7:42 pm UTC), leading to an immediate halt of transfers and a comprehensive security examination of all supported cryptocurrencies.

The exchange clarified that the breach was confined to the hot wallet system, ensuring that its cold wallet reserves were safe. In response, Upbit transferred the remainder of its assets to cold storage and attempted to initiate on-chain freezing measures.

This breach has reignited discussions surrounding Upbit's security protocols, especially given the recent $10 billion acquisition agreement made by Dunamu, Upbit’s parent company. It also brings to mind a previous incident in 2019, where Upbit lost nearly $50 million due to an attack by the North Korean hacking group, Lazarus.

🚨 ALERT: Upbit suspends deposits and withdrawals after $36 million abnormal outflow from Solana network, with assets reportedly sent to an unknown wallet on Nov 27. Upbit confirms it will cover all losses.

User Funds Will Be Reimbursed

Upbit announced the temporary suspension of all deposit and withdrawal services as a precautionary measure, which will remain until the ongoing security review is complete. This freeze affects not only Solana assets but all digital currencies on the platform as Upbit works to fortify its systems and identify any additional risks.

While trading continues normally, users cannot transfer funds in or out of the exchange during this review period. The company reassured users that any losses resulting from the security breach will be fully compensated by its reserves, guaranteeing that no customer assets would be at risk.

Customers are not required to take any action to retrieve their funds, but the exchange requested their patience as it performs a wide-ranging audit and collaborates with regulators to conclude the investigation. Local financial authorities have already initiated on-site evaluations of the situation. However, Upbit has not provided a specific timeline for recovery.

Cointelegraph has reached out to Upbit and Dunamu for statements but has not received any response as of the time of publication.

Cybersecurity Challenges in Crypto Exchanges

At the TBD conference, Matej Zak, CEO of Trezor, commented on persistent security challenges within cryptocurrency exchanges, labeling them “massive honeypots for hackers.” He expressed concern that security is an ever-evolving challenge that will persist.

Zak highlighted a significant increase in crypto asset theft, citing a report from blockchain security firm CertiK indicating that approximately $2.47 billion was stolen through hacks, scams, and exploits in the first half of 2025. He noted that a notable incident was the $1.5 billion hack of Bybit in March, which stands as one of the largest breaches in the crypto sector.

A Critical Moment for Dunamu Amid Expansions

This security incident takes place during a crucial time for Upbit, as its parent company, Dunamu, is engaged in a $10.3 billion acquisition deal with the South Korean search engine company Naver. As per a filing made on Wednesday, Naver Financial will acquire Dunamu—the entity that operates Upbit—in a stock-swap agreement valued at 15.1 trillion won (about $10.3 billion).

Following this acquisition, Naver will issue 87.5 million new shares to Dunamu’s shareholders, making Dunamu a wholly owned subsidiary. Additionally, Dunamu aims to launch an initial public offering (IPO) in the United States post-merger.

Moreover, Naver and Dunamu are reported to be planning to invest nearly $7 billion over the next five years to develop an ecosystem that supports Web3 technologies and artificial intelligence.