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The Financial Intelligence Unit (FIU) of South Korea, which falls under the Financial Services Commission (FSC), has initiated enforcement action against several cryptocurrency exchanges, including KuCoin and BitMex, for operating in the country without registering as a Virtual Asset Services Provider (VASPs) under South Korea’s Specific Financial Information Act.
According to local media reports published on 21 March 2025, the South Korean authorities are considering sanctions such as blocking access to all crypto exchanges not registered as VASPs, in collaboration with the Korea Communication Standards Commission (KCSC).
Other crypto exchanges accused of violating South Korean anti-money laundering (AML) and financial regulations include CoinW, Bitunix, and KCEX. Authorities have accused all exchanges listed here of operating without necessary approvals and adherence to the country’s compliance processes by offering marketing and customer support to South Korean investors.
South Korea is cracking down on unregistered foreign crypto exchanges!
The FIU is targeting KuCoin, BitMEX, CoinW, Bitunix, and KCEX for operating without proper registration. Authorities may block access to these platforms as part of stricter enforcement.
Regulators…
— Pushpendra Singh Fan Club (@pushpendrajifan) March 21, 2025
Crypto companies involved in storage, brokerage, crypto sales, and management are mandated to report to the FIU. Non-compliance renders the company’s activities illegal and exposes it to criminal prosecution, penalties, and administrative sanctions.
This regulatory correction in South Korea, however, reflects a broader global trend. As the crypto market is maturing, regulators worldwide are imposing stricter rules and guidelines to maintain transparency, security, and compliance.
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Investigators Are Also Examining Homegrown Exchanges In South Korea
While investigations into the international exchanges are ongoing, homegrown exchanges in South Korea are also facing the heat over suspicions of financial misconduct.
Just yesterday, South Korean authorities raided the crypto exchange Bithumb over suspicions of its former CEO embezzling company funds to purchase an apartment.
Suspicions arose when it was revealed that Bithumb gave 3 billion Korean won (over $2 million) to former CEO Kim Dae-sik, who now works for the exchange as an advisor. The exchange countered that Kim had already taken a loan to repay the funds.
Crackdowns in South Korea against crypto exchanges for violating its rules are not a new phenomenon. Back in 2022, the FIU had requested the KCSC to block 16 unregistered crypto exchanges, including KuCoin, MEXC, and Poloniex, which resulted in many crypto exchanges suspending their operations in South Korea.
Last February, the FIU stated that South Korea had only 31 registered crypto firms, down from 42 in 2024. They delisted GDAC, ProBit, Huobi Korea, and Bitrade among the companies.
South Korea had recently announced plans to implement stronger AML rules, in line with their regulatory revamp focused on preventing financial crimes.
Furthermore, the authorities are also exploring other aspects of blockchain technology. The Bank of Korea recently announced its upcoming CBDC pilot project set to launch in April this year, which will tentatively last for three months.
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Key Takeaways
- South Korea is cracking down on unregistered crypto exchanges like BitMEX and KuCoin among others.
- South Korean authorities are considering blocking access to all crypto exchanges not registered as VASPs.
- Authorities raided Bithumb over suspicions of its former CEO embezzling company funds to purchase an apartment.
The post South Korea Cracks Down On KuCoin And BitMex Among Other Crypto Exchanges appeared first on 99Bitcoins.
