South Korea Prepares Sanctions on Crypto Exchanges After FIU AML Reviews

TLDR

• South Korea’s FIU is issuing sanctions to crypto exchanges over anti-money laundering (AML) compliance failures.
• Inspections covered Upbit, Bithumb, Coinone, Korbit, and GOPAX, focusing on KYC and suspicious transaction reporting.
• Dunamu, Upbit’s operator, was sanctioned with a 35.2 billion won fine and a three-month suspension on key services.
• Legal reviews and sanction committees are underway for the remaining exchanges, following the order of inspections.
• Regulatory actions are expected to conclude by mid-2025, amid delays in South Korea’s crypto tax regime rollout.

South Korea’s financial regulator is intensifying its crackdown on crypto exchanges, targeting violations of anti-money laundering laws. According to a report by a local media outlet, the Financial Intelligence Unit (FIU) is preparing new sanctions against several virtual asset platforms following a year-long series of inspections. This enforcement effort focuses on identifying failures in Know Your Customer (KYC) protocols and suspicious transaction reporting. Authorities are now completing legal reviews ahead of final penalty announcements.

FIU Moves Through Inspections in Sequential Order

The South Korea crypto sanctions are progressing based on the inspection schedule. FIU officials have already issued sanctions against Dunamu, the operator of Upbit, after conducting an inspection in August last year. A Wu Blockchain post on X confirmed that subsequent reviews took place at Korbit in October, GOPAX in December, Bithumb in March, and Coinone in April. With most fieldwork complete, the FIU is advancing to committee-level reviews to determine final penalties.

Dunamu received multiple penalties earlier this year. In February, the FIU issued a disciplinary warning to the company’s CEO and suspended new deposit and withdrawal services for three months. This was followed by a financial penalty of 35.2 billion won on November 6. These actions form the benchmark for other expected South Korean crypto sanctions, as regulators investigated similar anti-money laundering procedures across all exchanges.

More Exchanges Await Outcomes Amid Ongoing Legal Reviews

As Bithumb underwent an additional inspection of its order book system, its case may see a delay. Still, sanctions for Korbit, GOPAX, and Coinone remain in the pipeline. Regulatory decisions are expected to follow the sequence of inspections. Analysts anticipate that these penalties will mirror the Dunamu outcome, with a combination of financial penalties and operational restrictions.

Regulators are unlikely to finish the South Korea crypto sanctions before year-end. Remaining actions are expected to conclude in the first half of 2026. This enforcement phase overlaps with uncertainties surrounding South Korea’s delayed crypto tax regime, currently slated for implementation in January 2027. As inspections conclude, authorities continue to apply pressure while maintaining policy discussions on digital asset innovation. The South Korea crypto sanctions reflect a push for regulatory stability across the country’s digital asset space.

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