South Korean lawmaker Park Seong-hoon has introduced a significant amendment to the Virtual Asset User Protection Act, proposing that cryptocurrency exchanges be held financially liable for hacking damages. This legislative shift would require exchanges to prove their innocence in security breaches, reversing the current burden of proof from users to virtual asset service providers. The proposal aims to enhance investor protection and align crypto regulations with traditional financial standards. The amendment mandates immediate reporting of security incidents to financial authorities, addressing concerns over delayed disclosures. This move is part of South Korea's broader efforts to modernize financial regulations, including guidelines for security token offerings and anti-money laundering measures. The proposed changes could lead to increased security investments by exchanges and potentially influence global regulatory practices. If enacted, the amendment could reshape the operational landscape for exchanges, particularly affecting smaller platforms and international operators in South Korea. The legislation's progression will be closely watched as it may set a precedent for crypto regulation worldwide.