Key Insights:
- South Korea fined Bithumb $24.5 million after the regulators discovered millions of AML violations.
- New Bithumb users face a six-month ban on external crypto transfers from March 27.
- Hana Financial partnered with Standard Chartered to expand its collaboration in digital assets.
Financial regulators in South Korea fined cryptocurrency exchange Bithumb 36.8 billion won, about $24.5 million, and suspended some of its services after finding that most of its operations violated anti-money laundering laws.
Inspection Finds 6.65 Million AML Compliance Violations
The penalty, according to Yonhap News Agency, resulted from an inspection that uncovered millions of compliance failures in identity verification, transaction monitoring, and record-keeping.
Authorities said the sanctions represent the largest financial penalty imposed on a South Korean crypto exchange to date and form part of a broader regulatory campaign targeting AML compliance among digital-asset platforms operating in the country.
The Financial Intelligence Unit (FIU), which operates under the Financial Services Commission (FSC), decided after reviewing the exchange’s compliance with the Act on Reporting and Use of Specific Financial Transaction Information.
The regulator claimed that the inspection revealed around 6.65 million violations of the exchange’s AML responsibilities.
Unregistered Overseas VASP Transfers Enforcement
The violations identified during the inspection, according to the regulators, involved various core AML requirements imposed on crypto service providers in South Korea. Authorities also reported that Bithumb facilitated 45,772 cryptocurrency transfers linked to 18 overseas virtual asset service providers that were not registered with South Korean regulators. Transactions with unregistered foreign VASPs are prohibited under the country’s AML framework.
According to the FIU, the exchange had previously received warnings instructing it to halt transactions involving such entities. Regulators said the company did not implement effective systems to block those transfers. The FIU concluded that Bithumb failed to comply with regulatory directives and continued to process transactions involving unregistered overseas crypto firms.
However, the sanctions deliberation committee finalized the measures after reviewing the findings and assessing the exchange’s compliance record under South Korea’s financial transaction reporting law.
Six-Month Partial Suspension Targets External Transfers
Alongside the financial penalty, regulators ordered a partial suspension of Bithumb’s services affecting certain new customer activities. The restriction will apply for six months, beginning March 27 and continuing through Sept. 26.
During that period, new customers will be prohibited from conducting external cryptocurrency transfers through the exchange. Regulators described the measure as a targeted operational restriction linked to the compliance violations identified during the AML inspection.
Moreover, the operational restriction applies only to external crypto transfers initiated by new users during the suspension period. South Korean authorities said the limited scope of the suspension was designed to enforce compliance while avoiding disruption to existing market participants.
Bithumb Fine Marks Largest Penalty for Korean Exchange
The 36.8 billion won penalty represents the largest fine imposed on a cryptocurrency exchange in South Korea. The action forms part of a broader enforcement campaign in which regulators have taken similar measures against other trading platforms over AML compliance failures.
In February 2025, the FIU imposed a three-month restriction on crypto deposits and withdrawals for new users on the exchange Upbit. That case also involved violations related to transactions with unregistered virtual asset service providers. Upbit received a financial penalty of 35.2 billion won, equivalent to approximately $23.5 million.
Regulators have referred to the implementation of these measures as continuing to enforce compliance by crypto platforms with financial transaction reporting and anti-money laundering requirements.
Bithumb, established in 2014, is one of the largest digital asset exchanges in South Korea by trading volume, according to the cited data on CoinGecko. The regulatory move follows the exchange’s operational error that resulted in the wrongful issuance of billions of dollars in bitcoin to users.
Hana Financial Diversifies Digital Assets.
As regulators stepped up enforcement against crypto exchanges, large financial institutions in South Korea increased their participation in digital asset projects. Hana Financial Group stated that it has entered into a business partnership with Standard Chartered Group, based in the United Kingdom, to enhance collaboration in financial services and digital asset-related activities worldwide.
Hana Financial Chairman Ham Young-joo said the partnership aims to develop new growth opportunities in emerging financial sectors. He stated that the companies intend to combine their global networks and financial expertise to expand cooperation in future financial industries, including digital assets.
The collaboration builds on recent digital asset initiatives by the South Korean financial conglomerate. Earlier in March, Hana Financial said it had partnered with the issuer of the USDC stablecoin, Circle, and the U.S. crypto exchange Crypto.com.
