The Seoul Southern District South Korean court ruled ordered that Coinone exchange compensate hacked user 25 million won.
September 26, 2019, | AtoZ Markets - The Seoul Southern District Court has ordered CoinOne cryptocurrency exchange to compensate an investor who is a victim of a successful hack attack.
Crypto exchange Coinone ordered to pay a victim of hack attack
Posted on a Korean news website September 26, the South Korean Court has ordered Coinone to pay 25 million won ($20,800) to an investor. The attacker used the investor’s personal login details and password to steal cryptocurrencies worth 47.7 million won back in December 2018.
The hacker, who had hidden his IP address using a VPN in the Netherlands, converted all of the stolen coins into Bitcoin after which they were withdrawn from the exchange.
According to CoinOne's policy, a daily withdrawal limit of 20 million won was supposed to be in place and this would have prevented the whole cryptocurrencies in the account from being withdrawn.
Safeguards not effective in preventing crypto theft
The investor insisted that the crypto exchange should have taken the initiative to block access from foreign IP addresses that were different than the user's normal access IP and that the BTC exceeded the withdrawal limit.
However, the court ruled that is not generally necessary to block foreign IP access unless the coin was specifically recognized as being illegal. Meanwhile, on the failure of the withdrawal limit though, the court ruled that the exchange was responsible, and, therefore, must pay 25 million won to cover the additional losses over this limit.
Crypto hacking on the rise
Cryptocurrency scams, frauds, and hacking attacks have also been increasing steadily which results in billions of dollars of losses emptying investors’ banks’ accounts.
As reported by AtoZMarkets, a recent U.N. report alleges that North Korea has stolen $2 billion worth of crypto and fiat currencies in 35 separate attacks in 17 countries. South Korea’s UPbit exchange may have been one of the targets, with the North using phishing attacks to gain control of the computers of customers.
North Korea denied the crypto hacks allegations, stating that the United States and other hostile forces are spreading ill-hearted rumors to tarnish the image of the country.
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