Upbit recovers ￦2 billion after Polygon blockchain mix-up

Upbit, Korea's largest cryptocurrency exchange, said Friday that it was able to recover digital assets worth 2 billion won ($1.69 million) that were incorrectly transferred using an unsupported blockchain network.

Upbit, Korea's largest cryptocurrency exchange, said Friday that it was able to recover digital assets worth 2 billion won ($1.69 million) that were incorrectly transferred using an unsupported blockchain network.

With cryptocurrencies, transfer errors can result in assets being lost for good.

Dunamu-operated Upbit started supporting trading of the cryptocurrency Polygon from Oct. 15. While the coin uses both the Ethereum and Polygon blockchain network, the cryptocurrency exchange had announced that it will only support deposits of Polygon on the Ethereum network.

However, some users mistakenly chose the Polygon blockchain when transferring their Polygon tokens at other exchanges to Upbit.

If digital assets are transferred on an unsupported blockchain, they often cannot be recovered in principle because it is impossible for exchanges to come up with recovery systems in an environment where numerous digital tokens are being created on different networks.

Upbit said that on this occasion it was able to recover the tokens after launching a technical partnership with the Polygon project team to recoup investors' losses. Based on the partnership it was able to recover all Polygon tokens that were transferred through the Polygon blockchain from Oct.15 through Oct. 17.

"We were able to recoup the digital assets of our investors thanks to active cooperation by the Polygon project team," a spokesperson from Dunamu said. "We will develop technologies related to recovering incorrectly transferred assets, while communicating more with users to prevent wrong transfers in the first place."

BYKIMJEE-HEE[kim.jeehee@joongang.co.kr]