Upbit Puts Zilliqa on Watch After Major Security Flaw

Zilliqa is facing serious trouble after discovering a security flaw in its Ledger wallet app. The issue stems from a coding error that weakened the security of private keys, making them vulnerable to attackers after only a few transactions. The project confirmed that this bug has existed since the app launched in 2019, meaning any user who signed five or more native transactions is likely compromised.

Following the discovery, the South Korean exchange Upbit placed ZIL on its delisting watch list. The exchange frozen deposits and withdrawals while it reviews the project under local investor safety laws. The review process is expected to continue until the week of August 17.

Zilliqa has suspended native token transfers to prevent further losses. While users who rely on software wallets or EVM transactions remain safe, the damage to market sentiment is clear. ZIL prices dipped significantly following the news, hitting record lows as traders react to the uncertainty of a potential delisting.

The future of ZIL on major Korean exchanges depends on the recovery plan the team puts forward. Investors should watch for updates on how the project intends to compensate those affected, as this will heavily influence Upbit's final decision on whether to keep or remove the token from its platform.