South Korean Crypto Exchange UPBit Passes Audit, Proves Solvency

UPbit had been the target of suspicions of price manipulation and was raided numerous times.

South Korean exchange UPbit has passed its audit, showing full solvency. A report from the Yoojin Accounting Corporation shows that UPbit’s reserves ratio stands at 103 percent and cash ratio stands at 127 percent.

UPbit originally requested the audit after local authorities raided the company and seized its servers in May. Cryptovest reported that the exchange was raided several times due to suspicions about price manipulation, a fraudulent balance sheet, and insolvency.

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“We Are Able to Pay Whenever Our Customers Wish to [Withdraw]”

“Since early 2018, UPbit created snapshots of its multi-signature wallets and funds stored within them for auditing purposes. Yoojin accounting firm, a major accounting firm based in Seoul, confirmed that all of the funds on the UPbit platform match the cryptocurrency holdings of UPbit stored in its multi-signature wallets,” said a local news source.

In the statement announcing the success of the audit, Lee Seok-woo, CEO of Dunamu, which owns UPbit, said that “we hold excess amounts of cryptocurrency and cash reserves than what we have to pay our customers. This indicates we are able to pay whenever our customers wish to [withdraw.]”

The South Korean government has yet to comment on the audit.

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South Korean Exchanges Under Pressure as Hacks Continue Around the World

The successful audit is a breath of fresh air for the South Korean crypto exchange industry, which has endured some rough spots since late 2017. The now-defunct exchange Youbit filed for bankruptcy following a hack that resulted in a 17 percent loss of user funds in December.

Additionally, Bithumb was hacked for $30 million in June, and halted the acceptance of new clients soon after, citing banking issues. The exchange began publishing audits of its own in April.

Earlier this year, in April, executives from Coinnest were questioned in connection with allegations that the exchange was stealing its own users’ funds.

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