South Korean Crypto Exchange Giant Bithumb Fined $24,800,000 Over Alleged Customer Verification Failures

South Korean financial regulators reportedly slapped the crypto exchange Bithumb with a 37 billion won ($24.8 million) fine over alleged customer verification lapses.

South Korea’s Financial Intelligence Unit (FIU) accused the exchange of failing to verify the identity of its customers in 6.59 million different instances, as well as facilitating around 45,000 transactions with 18 unregistered exchanges overseas, the Seoul-based news agency Yonhap reports.

The FIU will also impose a six-month partial business suspension in addition to the fine, and Lee Jae-won, Bithumb’s CEO, will reportedly receive an “official reprimand.” The regulator, however, will provide Bithumb with 10 days to respond to the fine before it is officially finalized.

The FIU’s crackdown on Bithumb materializes as crypto ownership booms across South Korea. Last year, Yonhap, citing data released by the South Korean government, reported that 16.29 million people had opened accounts on Upbit, Bithumb, Coinone, Korbit and Gopax, the country’s top five domestic crypto exchanges, with industry officials predicting that South Korea would soon be home to 20 million crypto investors.

South Koreans with accounts at multiple exchanges were reportedly only counted once to keep the data accurate. The country currently has an overall population of nearly 52 million.

There were reportedly 14 million crypto investors in South Korea in March 2024, and more than 500,000 new investors in the country purchased crypto in November 2024, the same month that Donald Trump won the US presidential election. Trump pivoted to crypto-supportive stances during his presidential campaign.

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