Solana News Today: Upbit's Naver Merger Clouded by $36M Hack, Sparking Security Scrutiny

South Korea's largest cryptocurrency exchange, Upbit, suffered a $36.8 million breach in Solana-based assets earlier this month, reigniting concerns over cybersecurity in the digital-asset sector and casting a shadow over its merger with Naver, a tech giant seeking to expand into crypto markets. The hack, which involved the unauthorized withdrawal of over 20 tokens-including SOL, USDC, and smaller Solana projects-occurred just days after Dunamu, Upbit's parent company, announced a $10.3 billion stock-swap merger with Naver Financial.

Upbit has pledged to reimburse affected users using its reserve funds, emphasizing that customer assets will not bear the loss.

The incident echoes a 2019 cyberattack on the same platform, which saw $41.5 million in Ethereum stolen and later attributed to North Korea's Lazarus Group, a state-sponsored hacking collective. While the current breach has not been officially linked to Lazarus, experts point to the similarities in tactics and the geopolitical context of North Korea's persistent cyber operations. The attack has intensified scrutiny of Upbit's security protocols, particularly as the exchange prepares for a potential Nasdaq listing following its consolidation with Naver a move that has drawn significant attention.

Upbit's merger with Naver, finalized in November 2025, is part of a broader strategy to solidify its regulatory compliance and scale for global expansion. The deal valued Dunamu at $10.3 billion, with Naver Financial acquiring 100% of the exchange operator to create a fintech powerhouse integrating blockchain, AI, and digital payments. The merger was also seen as a prelude to a U.S. IPO, with analysts noting that the combined entity's financials-Dunamu reported $165 million in net income for Q3 2025-align with investor appetite for crypto firms with verifiable revenue and governance structures according to market analysts.

Despite its dominance in South Korea's crypto market-handling 80% of trading volume in certain months-the hack underscores vulnerabilities in the industry's infrastructure. Regulators have already flagged Upbit for compliance issues, including over 700,000 KYC violations, and the incident may delay its public-market ambitions according to financial reports. Meanwhile, the Financial Supervisory Service is investigating the exchange for potential lapses in reporting and data security, with unconfirmed reports suggesting possible restrictions on new user onboarding as per official statements.

The breach also highlights the broader challenges facing crypto exchanges in a year marked by high-profile security incidents. Galaxy Digital's shift to Nasdaq and Kraken's confidential IPO filing reflect a push for institutional credibility, yet Upbit's vulnerability demonstrates the risks of rapid growth according to industry experts. As South Korea positions itself as a global fintech hub, the incident could influence regulatory reforms, particularly as the government invests heavily in AI and blockchain ecosystems a development that analysts see as significant.

With Upbit's response including asset freezes, cold wallet transfers, and collaboration with authorities, the exchange aims to restore user confidence ahead of its anticipated IPO according to recent reports. However, the attack serves as a stark reminder of the need for robust security measures in an industry still grappling with trust and transparency.