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Korea’s FSC Proposes Steeper Penalties for Hacked Crypto Exchanges

South Korea’s financial regulator has proposed a bill to significantly increase penalties on hacked crypto exchanges, aiming to strengthen accountability and investor protection after recent high-profile security breaches.

Fact Check
The assessment is based on multiple high-authority and highly relevant sources that consistently and directly support the statement. Several news reports, including two from the major South Korean newspaper The Chosun Ilbo, explicitly state that the Financial Services Commission (FSC) has put forward a proposal to cap shareholding in domestic cryptocurrency exchanges. The articles specify that the proposed caps are around 15-20% and are part of the 'Virtual Asset Phase 2 Legislation Bill'. This information is further corroborated by other news platforms. There is no conflicting evidence among the provided sources; the sources with low relevance either discuss different regulatory topics or are entirely unrelated to South Korean regulations, and therefore do not weaken the claim. The consistency, directness, and high authority of the supporting evidence lead to a high level of confidence in the statement's truthfulness.
Summary

South Korea’s Financial Services Commission has proposed a new bill that would impose fines of up to 10% of the value of stolen assets on cryptocurrency exchanges affected by hacking incidents. The draft proposal follows a $36 million hack of Upbit in November 2025 and would substantially raise penalties compared with the current maximum fine of about $456,000. The measure is part of broader regulatory efforts to tighten oversight of the domestic crypto market.

Terms & Concepts
  • Financial Services Commission (FSC): South Korea’s financial regulator responsible for supervising financial institutions, markets, and digital asset businesses.
  • Crypto Exchange: An online platform that facilitates the trading, buying, and selling of cryptocurrencies for users.