Upbit has removed Taiko (TAIKO) from its trading warning list after reviewing the Ethereum layer-2 project’s explanation and response to a June security breach.
Summary
- Upbit removed TAIKO’s warning after reviewing the June exploit, project response, and later security measures.
- TAIKO deposits will resume across three markets, while delayed transfers enter user accounts in sequence.
- The token rose after delisting concerns eased, though Upbit warned traders about renewed price volatility.
The South Korean exchange announced the change on July 24 for TAIKO/KRW, TAIKO/BTC and TAIKO/USDT.
The decision removes the immediate risk that Upbit could end trading support under its warning process. The exchange also plans to restore TAIKO deposits and process transfers made during the suspension in order. Upbit warned that price differences with overseas exchanges could create sharp moves when deposits reopen.
Upbit ends TAIKO review after project response
Upbit placed TAIKO under warning on June 22 after identifying a security incident involving systems used to issue, transfer or store the asset. The exchange said an unexplained or unresolved breach could expose users to losses. It suspended deposits while it reviewed the event and Taiko’s response.
In its July 24 notice, Upbit said Taiko submitted information covering the cause of the breach and its later security work. The exchange reviewed those materials and decided that “the reason for the trading warning has been resolved.” Upbit did not publish the technical documents or list the exact controls that satisfied its review.
The review period lasted 32 days. During that time, Upbit kept three spot markets open, allowing users to trade existing balances while blocking token inflows until its security assessment ended. Bithumb followed a similar review schedule after placing TAIKO under warning on the same date.
June exploit forced Taiko to halt network activity
The warning followed an attack on Taiko’s bridge and chain-state verification system. Taiko told users to withdraw funds from bridges after crafted proofs allowed unauthorized releases from its ERC20 vault on Ethereum. The project also asked centralized exchanges to stop TAIKO deposits and halted new block production during its response.
Security researchers estimated losses at more than $1 million, while later reports placed the amount near $1.7 million. Blockaid said flawed source-signal proof checks allowed the attacker to submit withdrawal messages without matching events on Taiko. Other researchers examined whether an exposed signing key helped the attacker create proofs that the Ethereum-side verifier accepted.
Taiko contained the unauthorized withdrawals after pausing affected systems and coordinating with its Security Council and partners. The team also published attacker addresses and said it would pursue technical and legal steps. It did not immediately provide a full public timeline for restoring each affected bridge.
Deposits return as network services stabilize
Bithumb also suspended TAIKO deposits and withdrawals on June 22 because Taiko stopped block production. The exchange restored withdrawals on July 3 after the network became stable, although deposits remained unavailable while the warning review continued. Bithumb also removed its TAIKO warning on July 24 and scheduled deposits to resume.
Taiko’s public status page now shows its mainnet sequencing, batch submission, proof submission and proof verification systems as operational. That status supports the exchanges’ decision to reopen services, although it does not remove the need for continued monitoring. Upbit said transfers sent during the deposit suspension will appear after service resumes.
Upbit advised users to confirm the correct network before making new deposits. Transactions sent through unsupported networks may not reach exchange accounts. The company also said deposits made during the suspension would receive account credit in sequence once its systems reopened.
TAIKO rises after delisting threat clears
TAIKO reacted positively after the warning ended. Upbit market data showed TAIKO/KRW trading as high as 132 won on July 24, with the pair gaining about 11% during the session. Trading volume also increased from the previous day as market participants responded to the exchange notice.
The rebound followed a difficult month for the token. TAIKO reached a record low of 90.4 won on Upbit on June 25, three days after the security incident and warning designation. Even after the July recovery, the token remained far below its June 2024 record high on the exchange.
The warning removal does not represent a guarantee against another breach or future exchange review. Upbit can place an asset under warning again if new security, disclosure, liquidity or operational concerns arise. The exchange also reminded users that crypto assets can cause a partial or total loss of invested funds.The Taiko incident formed part of a wider series of bridge attacks during 2026. As previously reported, Verus Protocol’s Ethereum bridge lost more than $11.5 million after forged transfer data passed its checks. Axelar also disabled Secret Network routes after a separate $4.7 million exploit.
Those cases show why exchanges can suspend deposits even when spot trading remains open. A compromised bridge or chain can allow attackers to send assets that lack valid backing or move stolen tokens into exchange accounts. Deposit controls give exchanges time to assess the network and prevent disputed balances from entering their systems.
Upbit’s decision closes the current warning review rather than the wider security process. Taiko still needs to maintain its bridge, proof and validator protections while supporting exchanges that reconnect deposits. Upbit advised traders to watch for rapid price moves as Korean and overseas markets reconnect.
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