South Korean Exchanges May Now Store 99% of Customer Assets in Cold Wallets Post $6.3B Binance Hack

South Korea’s financial regulator is weighing stricter custody rules for cryptocurrency exchanges after the record $6.3 billion Binance hack, according to reports of an emergency meeting held this week.

The Financial Services Commission convened major domestic platforms, the Financial Supervisory Service and industry groups on November 2nd to review security practices after unauthorized withdrawals from Binance hot wallets. They urged exchanges to raise the proportion of customer assets kept in cold storage, offline and disconnected from the internet, alongside tighter access controls, continuous monitoring of deposits and withdrawals, and stronger incident-response measures.

Under existing rules in the Virtual Asset User Protection Act, exchanges must already hold at least 80% of user assets in cold wallets, yet discussions at the meeting explored pushing that threshold significantly higher, with some reports indicating consideration of a level around 99%. Major platforms already operate at different ratios, as Upbit has reported more than 99% offline, while others range from the mid-80s to mid-90s.

No final rule change has been announced, and the FSC’s public statements emphasize the need for greater offline holdings to limit exposure in the event of a breach without specifying a new mandatory percentage.

Higher cold-wallet requirements could reduce the liquid assets available for immediate withdrawals, potentially affecting smaller exchanges more than larger ones that already maintain elevated offline ratios, reflecting heightened regulatory focus on exchange security following the largest crypto theft on record, which investigators have linked to a North Korean hacking group.

The new development follows hackers draining roughly $6.3 billion from Binance hot wallets across 10 blockchains in about 20 minutes on October 29th, 2026, marking the largest crypto theft on record. Investigators link the attack to North Korea’s TraderTraitor group, which compromised the exchange’s transaction-signing systems. About half the funds were frozen by stablecoin issuers. Binance has since pledged to cover all losses from its reserves and company funds.​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​