South Korea’s largest cryptocurrency exchange, Upbit, recently announced a significant privacy policy change: From Oct. 1, Upbit will store user data on US-based servers. This exchange will use Amazon Web Services (AWS) to boost its services’ reliability while also considering privacy and regulatory issues.
Moving to AWS is a smart decision to improve service continuity, scalability, and data security using cloud service providers. AWS’s infrastructure protects against data breaches, system failures, and cyberattacks and ensures user information remains secure even in tough situations.
This transition is set to enhance Upbit’s reliability, especially in terms of performance and uptime. It will also align Upbit with other crypto exchanges like Coinbase, which have already chosen AWS for their data storage needs.
CLOUD Act impact on Upbit users
Upbit’s choice to store user data on AWS brings up serious concerns about privacy and legal jurisdiction. Since the U.S. will keep the data, it will be subject to American laws and regulations. A key point to consider is the CLOUD Act, passed in 2018, which allows U.S. authorities to access data stored by US-based companies. This law allows U.S. law enforcement to demand data from companies like AWS, even if that data is stored in other countries.
This change allows U.S. authorities to access user data from Upbit, which raises significant privacy concerns for international users. According to the Chainalysis report, the increasing Korea Premium Index (KPI) shows the rapid growth of South Korea’s cryptocurrency market.
Also known as the Kimchi Premium, the KPI tracks the price difference for cryptocurrencies like Bitcoin and Ethereum between South Korean exchanges and global markets. Additionally, Chainalysis highlighted that factors like institutional trading, strong local demand, and specific market conditions in South Korea have led to significantly higher crypto prices on local exchanges than global averages.
