Hack Sees South Korean Crypto Platform Lose Over $13 Million

South Korean crypto platform GDAC lost at least $13 million in Bitcoin (BTC), Ethereum (ETH), WEMIX, and USDT through a hot wallet hack on April 9.

After the exchange’s monitoring system detected the hack, GDAC’s monitoring team suspended deposits and withdrawals and alerted authorities.

GDAC Hacked Funds Almost 25% of Assets Under Custody

The hacker stole 60.81 BTC (approximately $1.7 million), 350.50 ETH ($649,000), 10,000,000 WEMIX ($11.4 million), and 220,000 USDT ($220,000). The stolen assets make up 23% of GDAC’s assets under custody.

After the hack, the Seoul-based exchange contacted the police and reported the incident to the Korea Internet and Security Agency. It also notified the Financial Intelligence Unit, the government agency responsible for preventing money laundering and terrorist financing. 

It has also asked other exchanges to prevent deposits from a wallet address holding the stolen funds.

Hong Kong’s upcoming crypto legislation proposes allowing crypto custodians to hold up to 2% of customer assets in hot wallets. Platforms must also hold insurance to cover custody risks.

Security firm BlockSec has recovered 100 ETH from a DeFi hack that exploited a bug in SushiSwap’s Router2Processor2 smart contract on April 9. Security firm PeckShield initially reported that the hack cost one user at least 1,800 ETH ($3.3 million).

South Korean Authorities Frustrated in Do Kwon Extradition Efforts

South Korean prosecutors recently seized assets belonging to Terraform Labs’ co-founder Daniel Shin. 

Authorities have foreclosed Shin’s apartments in Seoul and land in Hwaseong and Gapyeong in South Chungcheong province. They have also seized cars belonging to Shin and others. The prosecutors estimate that proceeds from crimes allegedly perpetrated by Shin, Terraform Labs’ co-founder Do Kwon, and others totaled over $300 million. 

Korean prosecutors allege that Kwon, Shin, and other employees of Terraform Labs extorted money from investors in its TerraUSD and LUNA cryptocurrencies. 

Authorities in the U.S. and South Korea are seeking Kwon’s extradition, which Kwon’s lawyer said will not happen anytime soon.

Both TerraUSD and LUNA lost most of their value following large transactions over the weekend of May 10 2022.

Kwon, currently in a Montenegrin prison after being caught trying to flee with a fraudulent passport, allegedly converted $69 million in stolen proceeds to Bitcoin. 

Authorities have asked Binance to prevent Kwon from liquidating the proceeds. Unlike Shin, Kwon allegedly owns no property in South Korea.

For Be[In]Crypto’s latest Bitcoin (BTC) analysis, click here.