South Korea has imposed a hefty fine of 36.8 billion won (approximately $24.5 million) and a six-month partial business suspension on the cryptocurrency exchange Bithumb, following a series of Anti-Money Laundering (AML) violations.
According to regulators, Bithumb was found to have committed around 6.65 million violations during an AML inspection, including failures in customer identity verification, transaction restrictions, and record-keeping requirements. The Financial Intelligence Unit (FIU) under the Financial Services Commission (FSC) highlighted that Bithumb facilitated 45,772 crypto transfers involving 18 unregistered overseas virtual asset service providers (VASPs), in direct contravention of South Korea’s AML rules.
Regulatory Scrutiny Intensifies
The sanctions, which include the largest fine ever imposed on a South Korean crypto exchange, reflect the ongoing regulatory crackdown on AML compliance in the country. The FIU had previously warned Bithumb to halt transactions with unregistered overseas crypto firms, but the exchange failed to comply and implement effective blocking measures.
Partial Suspension Details
Under the sanctions, Bithumb will be banned from processing external crypto transfers for new customers from March 27 to September 26. However, existing users will not face any trading restrictions, and new customers can still buy or sell cryptocurrencies and deposit or withdraw Korean won from the exchange.
Broader Regulatory Actions
Bithumb is not the only exchange to face regulatory action. In February 2025, the FIU imposed a three-month restriction on crypto deposits and withdrawals for new Upbit customers due to violations related to dealing with unregistered VASPs. Upbit also received a 35.2 billion won (about $23.5 million) penalty. Similarly, in December 2025, the FIU fined Korbit 2.73 billion won (about $1.8 million) and issued an institutional warning over AML and customer-verification breaches.
Looking Ahead
The regulatory crackdown on South Korean crypto exchanges underscores the government’s commitment to ensuring the integrity and security of the cryptocurrency market. As the industry continues to grow, exchanges must prioritize compliance to avoid severe penalties and maintain trust with both regulators and users. The actions against Bithumb and other exchanges serve as a stark reminder of the importance of robust AML practices in the crypto space.
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