Bithumb Hit with $24.6M Fine for 6.65 Million AML Breaches
South Korea's Financial Intelligence Unit (FIU) has imposed a 36.8 billion KRW ($24.6 million) fine on cryptocurrency exchange Bithumb for systemic failures in its anti-money laundering controls. The penalty addresses approximately 6.65 million distinct violations uncovered during on-site inspections. These breaches include 3.55 million instances of failing to conduct required customer identity verification (KYC) and 3.04 million cases where the exchange did not properly block restricted transactions.
In addition to the financial penalty, the FIU ordered a six-month partial suspension of Bithumb's business operations. The regulator also took action against key personnel, issuing a formal reprimand to Bithumb's chief executive and suspending the exchange's reporting officer for six months. This disciplinary action stems from a broad investigation into the country's five largest crypto exchanges conducted between 2024 and 2025.
Crackdown Widens as Fine Mirrors Upbit's Penalty
The enforcement action against Bithumb demonstrates a consistent and escalating regulatory campaign in South Korea. The fine is comparable in scale to the 35.2 billion KRW fine and three-month partial suspension levied against Dunamu, the operator of top exchange Upbit, in the previous year for similar compliance shortcomings. Other platforms have also faced scrutiny, with rival exchange Korbit receiving a 2.73 billion KRW fine and institutional warnings.
The regulatory sweep targets violations of the Act on Reporting and Using Specified Financial Transaction Information, which mandates strict compliance for virtual asset service providers. The actions against major players like Bithumb and Upbit establish a clear precedent, signaling that regulators are committed to enforcing robust AML and KYC protocols across the domestic crypto market. This heightened oversight is expected to increase operational costs and compliance burdens for all regional exchanges.
Partial Suspension Limits New Users as Operational Woes Mount
The six-month suspension specifically targets new customers, who will be restricted from transferring digital assets off the platform. Bithumb has clarified that services for existing customers, including trading, deposits, and withdrawals, will continue without disruption. While the exchange stated that the sanctions are in a pre-notification stage and subject to final review, the measures highlight significant operational risks.
This regulatory penalty compounds recent challenges for Bithumb. The action follows a high-profile operational error in which the exchange mistakenly credited some users with large amounts of Bitcoin during a promotional event. The combination of regulatory sanctions and operational missteps may impact user confidence and the exchange's ability to attract new customers in a competitive market.
