South Korea Targets Unregistered Crypto Exchanges in Regulatory Crackdown

The Financial Intelligence Unit (FIU) is investigating platforms for operating without proper registration as virtual asset service providers (VASPs).

Some foreign exchanges, including KuCoin, are under scrutiny for providing services like marketing and customer support to South Koreans without proper compliance.

Authorities are considering sanctions, such as blocking access to these exchanges, and are consulting with the Korea Communications Standards Commission for enforcement.

In South Korea, exchanges involved in trading and asset management must report to the FIU, with non-compliance risking severe penalties.

Alongside foreign platforms, local exchanges like Bithumb are also facing issues. Bithumb’s former CEO is under investigation for embezzlement, while rumors of intermediaries paying for token listings on exchanges like Upbit and Bithumb have surfaced.