South Korean cryptocurrency exchange Upbit, backed by Kakao Corp, has paid six individuals a reward of 1 million won (approx. $931) each for reporting fraudulent crypto-related schemes. The exchange launched a bounty system in March to incentivize users to identify multi-level scams posing as cryptocurrencies or initial coin offering (ICO) tokens. Operator Dunamu Inc. stated: “To the original complainant, Upbit pays a reward of 1 million won.”
Last week, Upbit announced: “Since the implementation of the system, a total of 10 cases have been received and 6 of them have been selected. On June 6, we sent a reward of KRW 1 million with appreciation to the applicants.” The exchange clarified that it provides the bounty to users who report fraudulent acts impersonating ICOs to investigative agencies (police, prosecutors) and submit necessary evidence. Although some reports lacked proper documentation, Upbit decided to pay anyway to encourage participation and “create a sound cryptocurrency ecosystem.”
Upbit, once the top exchange in South Korea by trading volume, now ranks as the world’s eighth largest with a 24-hour volume of $201.6 million. It is the second largest in Korea, behind Bithumb ($239.1 million). Last month, Korean authorities launched an investigation into Upbit, as reported by Bitcoin.com.
World-Check System From Thomson Reuters
In addition to the fraud reporting system, Upbit recently adopted World-Check, developed by Thomson Reuters, to support transparent crypto transactions and strengthen its Know-Your-Customer (KYC) program. The system is described as “the trusted and accurate source of risk intelligence” to help meet regulatory obligations and prevent money laundering or association with corrupt practices.
When a user registers with Upbit, their information is checked against the World-Check database. If a high risk related to crime or terrorism is detected, registration is immediately terminated. The system also performs daily checks for criminal records of members. Upbit believes this will help prevent money laundering and terrorism financing via cryptocurrencies.
Meanwhile, a small South Korean exchange, Coinrail, claimed it was hacked over the weekend; police are investigating. Though unrelated to Upbit, the incident highlights ongoing security and compliance challenges in the Korean crypto space.
Overall, Upbit's dual efforts—rewarding whistleblowers and integrating international compliance tools—demonstrate its commitment to market integrity and transparency. Such measures may become industry benchmarks amid growing regulatory scrutiny.