As reported by Crypto.News, South Korean regulators are drafting legislation that would require cryptocurrency exchanges to fully compensate users for losses from hacks or system failures without requiring proof of negligence. The Financial Services Commission plans to introduce no-fault liability rules similar to those for banks and electronic payment companies. Under the proposal, exchanges must reimburse victims unless the user acted with clear gross negligence. The move follows repeated IT incidents, including a November 27 breach at Upbit that drained Solana-based assets in under one hour. Between 2023 and September 2025, South Korea’s five largest exchanges reported 20 separate IT incidents affecting over 900 users, according to CoinDesk data.
South Korea Proposes No-Fault Crypto Exchange Compensation Law
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