Angry Crypto Exchange Customers Will Get Compensation – If They Can Prove One Thing

South Korea Upbit

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Tim Alper

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Tim Alper

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Tim Alper is a British journalist and features writer who has worked at Cryptonews.com since 2018. He has written for media outlets such as the BBC, the Guardian, and Chosun Ilbo. He has also worked...

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June 26, 2023 06:53 EDT

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The South Korean market-leading crypto exchange Upbit has announced that it will compensate traders who lost money during the power outage that blighted the platform’s login functionality over the weekend – but only if they can prove they were really going to sell their coins during the blackout.

A fire broke out at a data center that hosts 32,000 of the chat app giant KakaoTalk’s servers on Saturday afternoon (KST), leading to an almost total blackout of services. This hit Upbit traders hard – as Upbit customers can only log onto the platform using a KakaoTalk-powered login service or using Apple IDs. For Android users without an Apple ID, the KakaoTalk login function remains their only way to access the platform.

A number of upset traders claimed they were unable to make important sales over the weekend, with some stating that they had lost “hundreds of USD” worth of money on trades they could not execute.

The exchange now says that it will compensate certain users – but those expecting an easy windfall may have to think again. The platform explained that it will require users to come forward with evidence that they were actually going to make the trades they claim they could not make while KakaoTalk was down.

Digital Today also reported that only customers who actually sold coins at a loss would be due compensation – and those who decided to HODL their tokens after prices rose would miss out.

Upbit explained that disgruntled customers “must provide specific facts and evidence” to support their claims – and must prove that they sold their tokens as soon as they were eventually able to log in to their accounts.

The media outlet wrote, quoting the trading platform, that “customers who did not sell their cryptoassets due to a drop in price or other reasons will not be awarded compensation.”

Compensation to Be Paid in BTC, Says Exchange

An Upbit spokesperson was quoted as stating:

“Since it is difficult to prove an intention to sell, we have decided to compensate those customers who actually sold their coins.”

The company added that it would pay out compensation in bitcoin (BTC), with individual amounts to be calculated by October 31.

Per CoinGecko data, the company’s 24 hour trading volume (at the time of writing) is $1,469,700,960, with CoinMarketCap putting the figure at $1,507,492,032.