South Korea is intensifying its efforts to block unauthorized cryptocurrency exchanges from operating within its jurisdiction. In the latest regulatory move, global trading platforms KuCoin and BitMEX have been added to a growing blacklist, as they are suspected of offering services to South Korean users without meeting local compliance standards.
According to The Bit Journal, the Financial Intelligence Unit (FIU), under South Korea’s Financial Services Commission, is actively investigating exchanges that fail to comply with the country’s Act on Reporting and Using Specified Financial Transaction Information. Under this law, any platform dealing with virtual assets must register as a Virtual Asset Service Provider (VASP) and submit relevant compliance reports to the authorities.
The FIU is currently coordinating with other regulatory bodies to prepare countermeasures against non-compliant exchanges. These measures may include blocking access to such platforms in cooperation with the Korea Communications Standards Commission, the country’s internet oversight authority.
More Exchanges Under the Radar
Alongside KuCoin and BitMEX, several other exchanges, including CoinW, Bitunix, and KCEX, are also under scrutiny. These platforms are accused of marketing to and supporting South Korean users without undergoing the mandatory registration and compliance procedures.
Authorities assert that crypto exchanges engaged in activities such as trading, storage, and brokerage must report their operations to the FIU. Failure to do so renders their business illegal and subject to criminal penalties and administrative sanctions.
A senior FIU official confirmed that steps are being reviewed to cut off access to these unregistered platforms, reinforcing the country’s strict approach to digital asset regulation.
Local Exchanges Also in the Crosshairs
The regulatory spotlight isn’t limited to overseas platforms. South Korea-based exchanges are also facing increased scrutiny over financial misconduct. On March 20, prosecutors raided Bithumb amid allegations that former CEO Kim Dae-sik misappropriated company funds to purchase a personal residence.
While Bithumb claims that Kim has already secured a loan to reimburse the company, regulators are investigating potential violations of financial laws during the transaction.
In addition, The Bit Journal has reported rumors suggesting that intermediaries at Upbit and Bithumb allegedly accepted payments from crypto projects in exchange for token listings. These unverified claims, which cite anonymous sources, raise concerns over transparency in token listing practices. In response, Upbit has requested the disclosure of project names involved in such alleged deals.
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