South Korean cryptocurrency exchange Bithumb could face a partial business suspension of up to six months after regulators flagged alleged anti-money laundering and customer verification failures.
South Korea’s Financial Intelligence Unit (FIU) issued a preliminary notice citing possible breaches of the Act on Reporting and Using Specified Financial Transaction Information, including concerns over dealings with unregistered overseas virtual asset service providers and insufficient customer due diligence.
“This measure is not yet a confirmed sanction, but is a pre-notification stage, and there may be some adjustments in the sanctions trial,”
A Bithumb spokesperson said, adding that:
“Restrictions only apply to the transfer (withdrawal) of virtual assets by new members.”
If finalised, the penalty would prevent newly registered users from withdrawing digital assets from the platform, while regulators conduct further enforcement actions.
The FIU also issued a reprimand warning to Bithumb’s CEO, a sanction considered severe because it could limit the executive’s future reappointment or leadership roles.
The case follows scrutiny of Bithumb’s internal controls after the exchange mistakenly credited 2,000 Bitcoin per user instead of 2,000 Korean won during a February promotional event, distributing about 620,000 BTC worth roughly $43 billion at the time.
South Korean regulators have intensified oversight of crypto exchanges, previously imposing a three-month suspension and a 35.2 billion won ($25 million) fine on Upbit’s parent company Dunamu in 2025, while exchange Korbit received a warning and a 2.73 billion won ($1.9 million) penalty over similar AML and KYC concerns.