South Korea Proposes 10% Revenue Fines for Hacked Crypto Exchanges

VADODARA, January 16, 2026 — South Korea’s Financial Services Commission (FSC) is drafting regulations to impose strict liability and punitive fines of up to 10% of revenue on cryptocurrency exchanges hacked. This latest crypto news, reported by MTN News, targets security failures. Industry backlash is immediate. Market structure suggests a liquidity grab in Asian trading sessions.

Market Context & Background

South Korea has oscillated between crypto innovation and stringent oversight. Historical cycles show regulatory shocks create Fair Value Gaps (FVGs) in asset prices. The proposed fine exceeds the 3% cap for electronic financial businesses under the amended Electronic Financial Transactions Act. This mirrors global trends like the EU’s Markets in Crypto-Assets (MiCA) framework but with sharper teeth. On-chain data indicates Korean exchanges hold significant Bitcoin and Ethereum reserves; a regulatory squeeze could force liquidations.

Related developments include South Korea's ruling party opposing ownership caps and Coinbase challenging the CLARITY Act in the U.S., highlighting global regulatory fragmentation.

What Happened?

According to MTN News, the FSC’s proposal mandates strict liability for hacking damages. Punitive fines could reach 10% of an exchange’s revenue. An industry official criticized the standard as excessive. The official noted the disparity with electronic financial penalties. The FSC has not finalized the rules. No implementation timeline is provided. The move follows high-profile exchange hacks in South Korea, eroding user trust.

Technical Analysis & Price Action

Bitcoin trades at $95,701, down 0.96% in 24 hours. The daily chart shows a consolidation pattern near the $96,500 resistance. RSI hovers at 52, indicating neutral momentum. The 50-day moving average at $93,200 acts as dynamic support. A Volume Profile analysis reveals low activity in Asian hours, suggesting caution.

Bullish Invalidation: $92,000. A break below this Order Block invalidates the uptrend, targeting $88,000.

Bearish Invalidation: $98,500. A close above this level confirms bullish continuation, eyeing $102,000.

By The Numbers

Why It Matters

Institutional impact: Higher fines may deter market makers, reducing liquidity. Compliance costs could spike, squeezing margins. Retail impact: Users might face higher fees or reduced services. Security upgrades could become mandatory, increasing operational overhead. The proposal could set a precedent for other Asian regulators, fragmenting global standards.

Community Sentiment

Market analysts on X/Twitter express concern. One noted, "Strict liability ignores the probabilistic nature of cybersecurity." Another highlighted, "This could trigger a capital flight to offshore exchanges." Sentiment is bearish for Korean platforms but neutral for broader crypto, pending further developments.

Price Prediction / Future Outlook

Bullish Case: If the FSC moderates the fines, exchanges may see a relief rally. Bitcoin holds $92,000 support, rallying to $102,000. Increased security spending boosts industry trust, attracting institutional inflows.

Bearish Case: If implemented harshly, exchanges face margin compression. Capital exits South Korea, creating a liquidity vacuum. Bitcoin breaks $92,000, testing $85,000. Regulatory uncertainty spreads, dampening global sentiment.