Upbit Solana hot-wallet drained ~$38.5M; deposits/withdrawals paused, exchange pledges to cover losses

Published: 2025-11-27 09:33:08 |

South Korea’s largest crypto exchange Upbit detected an unauthorized outflow of roughly $38.5 million from a Solana (SOL) hot wallet on Nov. 27 (flagged at 04:42 KST). The exchange immediately suspended all deposits and withdrawals across assets to perform a full security audit while keeping trading services active. Upbit says the breach was isolated to hot storage, cold wallets were unaffected, remaining hot funds were moved to cold storage, and the platform attempted on-chain freezes and recovery measures. Upbit’s parent company Dunamu had just announced a roughly $10.3 billion share-swap acquisition by Naver and plans for a U.S. IPO, bringing heightened scrutiny. Regulators launched on-site inspections and the exchange referenced its 2019 Lazarus-related hack as prior context. Upbit has pledged to fully reimburse affected users from its reserves and urged customers to await the audit. For traders: monitor SOL liquidity and on-chain movement, expect short-term volatility for SOL and related Solana tokens, and watch for regulatory responses and any withdrawal restrictions that could affect market flows.

Bearish

The breach is directly tied to Solana (SOL) via a hot-wallet compromise and therefore likely to exert negative pressure on SOL price in the short term. Immediate effects include reduced liquidity from paused deposits/withdrawals, potential panic selling, and increased on-chain movement as Upbit and others attempt freezes and recoveries — all contributing to short-term volatility and downward bias for SOL. The exchange’s pledge to cover losses and the isolation to hot storage mitigate some systemic risk and could limit long-term damage to SOL’s fundamentals. However, reputational damage, regulatory scrutiny, and renewed concerns over hot-wallet security on centralized exchanges may suppress investor confidence for an extended period, keeping medium-term sentiment muted until audits, recoveries, or regulatory clarity restore trust.