Will the exchange compensate for hacking damages under the Virtual Asset User Protection Act?

The Virtual Asset User Protection Act is a law that stipulates that if user assets are leaked due to hacking, etc., compensation liability may arise if the exchange's management responsibility is recognized.

However, compensation does not occur automatically in all cases.

Liability judgment under the Virtual Asset User Protection Act is made based on the following criteria.

First, whether storage and management obligations have been violated.

Exchanges are obligated to safely store user virtual assets, and a certain percentage or more must be separately stored in cold wallets.

If hacking damage occurs because such measures were not properly implemented, the exchange's negligence is likely to be recognized.

Second, the level of security system construction.

According to the purpose of the Virtual Asset User Protection Act, exchanges must have a reasonable level of security system.

If basic security measures are inadequate or internal management is poor, liability may be expanded.

Third, whether the user is at fault.

If the user has leaked account information or neglected security management, liability may be partially limited.

For example, sharing passwords or using phishing sites may be judged as negligence.

The Virtual Asset User Protection Act is not a structure of "hacking damage = automatic compensation," but a structure where compensation liability arises only when the exchange's management responsibility is recognized.

The scope of liability is determined based on ① whether the cause of hacking is the exchange's security problem and ② whether user negligence was involved.

Therefore, when damage occurs, rather than determining whether to compensate, it is necessary to conduct a legal review focused on the cause of the accident and whether management obligations have been violated.