South Korea's Financial Regulator Orders Exchanges to Raise Cold-Wallet Holdings

South Korea's Financial Services Commission (FSC) convened domestic crypto exchanges on Nov. 2 and directed them to increase cold-wallet holdings after an unauthorized transfer from a Binance hot wallet.

Participants included the Financial Supervisory Service, the Financial Security Institute, DAXA and South Korea's major domestic exchanges. The FSC used the meeting to assess protections across platforms.

Officials examined who can access exchange IT systems, what approvals and signatures are required before wallet assets move, and how administrator permissions are managed. The commission also called for real-time tracking of asset inflows and outflows, additional emergency-response staff and further reserve provisions.

The requests were directed at the domestic exchanges attending the meeting. They came after about $6.3 billion in assets were transferred without authorization from a Binance hot wallet on Oct. 30. South Korea's review now covers storage ratios, transfer controls and exchanges' capacity to respond to emergencies.