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Two Crypto Exchanges Fail to Renew Mandatory Insurance Amid Industry Downturn
Commercial Services · Financial Publishing/Services · yonhap_finance · 2026-09-01
Despite legal mandates for crypto service providers to maintain insurance, Guardian Holdings and CoreDAX have failed to renew their policies.
What Happened
Mandatory Insurance Requirements: Under the Virtual Asset User Protection Act, crypto service providers in South Korea are legally required to maintain insurance or set aside reserves to cover potential losses from hacking or system failures. Recent data from the Financial Supervisory Service indicates that compliance remains incomplete across the industry.
Non-Compliance Issues: Guardian Holdings and CoreDAX were identified as having failed to renew their insurance policies after their previous one-year coverage expired. Industry observers suggest that the ongoing market downturn and deteriorating financial performance of individual firms have led to these lapses in coverage.
Disparities in Financial Reserves: There is a significant gap in how different firms meet these safety requirements, with major exchanges like Dunamu and Bithumb holding substantial reserves of 80 billion won each. Meanwhile, Korea Digital Asset has secured the highest insurance coverage at approximately 40 million dollars.
Regulatory Oversight: The Financial Supervisory Service is actively encouraging non-compliant firms to secure insurance coverage immediately. Authorities plan to conduct formal reviews and may impose penalties, such as fines, if these companies fail to meet their legal obligations in the near future.