South Korean Regulator Will Shield Exchanges That Freeze Funds at the First Sign of a Hack

South Korea’s Financial Services Commission (FSC) , the country’s financial regulator, said on Thursday, Nov. 12, that it has decided to issue a no-action letter so crypto exchanges can block deposits and withdrawals when they suspect a hack . A no-action letter is a regulator’s written assurance that it won’t take enforcement action over a specific practice. The letter hasn’t been issued yet. The FSC’s release, published in Korean, gives no issue date and says the freezes would be allowed under certain conditions that it didn’t spell out. Under the Virtual Asset User Protection Act , exchanges may not block deposits and withdrawals without a justifiable reason, and a block is permitted only once a hack has clearly occurred.

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