Crypto Reporter
Shalini Nagarajan
Crypto Reporter
Shalini Nagarajan
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The South Korea financial watchdog is preparing a fresh round of penalties for domestic virtual asset exchanges, stepping up its campaign against anti-money laundering failures that regulators say threaten the integrity of the country’s fast-growing crypto market.
Financial authorities are expected to issue both institutional and individual sanctions, along with fines, against major trading platforms that breached anti-money laundering obligations, according to a local report published Monday.
The Korea Financial Intelligence Unit, or FIU, is moving through cases in the order of its on-site inspections, effectively using a first-in, first-out approach.
FIU Preparing Sanctions After Completing Major Exchange Inspections
The report said that the FIU plans to sanction the remaining large exchanges after already acting against Dunamu, the operator of Upbit. Since last year, the unit has carried out inspections at Upbit, Bithumb, Coinone, Korbit, and GOPAX to check compliance with rules such as Know Your Customer checks and the reporting of suspicious transactions.
Most fieldwork is now complete, and legal reviews and sanctions committees are underway.
Since the FIU is following the sequence of its inspections, markets expect decisions to land in roughly the same order as visits were made. Dunamu was inspected in August last year, followed by Korbit in October, GOPAX in December, Bithumb in March this year and Coinone in April.
Bithumb could be pushed back in the queue after an additional on-site review of its order book operations.
Sanctions Expected To Follow Dunamu Precedent With Similar Penalties Ahead
The process will mirror the Dunamu case, where officials first decided on personal and institutional sanctions, then confirmed the size of the fine. In February, the FIU issued a disciplinary warning to Dunamu’s chief executive and slapped the exchange with a three-month suspension on new customer deposits and withdrawals for breaches of the Special Financial Transactions Act.
On Nov. 6, it added a fine of 35.2b won.
Industry participants expect similar findings across the remaining exchanges, given that inspectors examined broadly the same anti-money laundering controls.
Regulators are expected to announce further institutional and personnel sanctions, alongside sizable monetary penalties. Officials and market observers have signalled that total fines across the group could reach into the hundreds of billions of won, although the final amounts will depend on the number and seriousness of violations at each platform.
Crypto Markets Face Stricter Oversight While Korea’s Sanctions Process Continues
With four exchanges still awaiting decisions, the FIU is unlikely to finish its sanctions calendar this year. Most of the remaining actions are expected to be wrapped up by the first half of next year, keeping regulatory pressure elevated over a period when global crypto markets are already adjusting to stricter oversight.
The enforcement drive comes as South Korea faces renewed uncertainty over its long-delayed crypto tax regime. Officials have warned that the country is still far from ready to start taxing virtual assets by the scheduled Jan. 2027 date, citing gaps in infrastructure and detailed guidance.
After five years of political debate, technical planning and repeated postponements, talk of a fourth delay has returned to the agenda.
In parallel, policymakers are trying to show they are still open to innovation. The ruling Democratic Party recently launched a new crypto policy task force that it says will “foster growth” in digital assets and blockchain.