South Korea fines Bithumb $24.7m, orders partial suspension

South Korea’s Financial Intelligence Unit fined Bithumb 36.8 billion won (US$24.7 million) and ordered a six-month partial suspension for violations of the Act on Reporting and Using Specified Financial Transaction Information.

The Financial Services Commission said the sanctions stem from violations of the Act on Reporting and Using Specified Financial Transaction Information found during on-site inspections of the country’s five largest exchanges in 2024–2025.

According to the FIU, Bithumb committed about 6.65 million violations, roughly 3.55 million failures to verify customer identities and 3.04 million failures to block restricted transactions.

The suspension applies only to new user accounts while existing customers may continue trading and moving funds.

Regulators also issued personnel penalties, giving a reprimand to Bithumb’s chief executive and suspending the exchange’s reporting officer for six months.

The move follows prior sanctions on other platforms, including a three-month partial suspension and 35.2 billion won (US$23.62 million) fine for Dunamu’s Upbit, and a 2.7 billion won (US$1.81 million) penalty for Korbit, and comes a month after Bithumb mistakenly sent billions of dollars in bitcoin to users.

🔗 Source: CoinDesk

🧠 Food for thought

Implications, context, and why it matters.

Regulatory pressure on Bithumb extends beyond this fine

The sanctions tie into a wider rule rewrite that includes debate and legislative work on a proposed Digital Asset Basic Act. Under it, exchanges would need to unwind concentrated ownership to meet a 20% cap over a multi-year transition period, with reporting suggesting Bithumb Holdings holds a stake above 70% in the exchange 1.
Lawmakers pitch the plan as a way to curb tight control, make governance easier to track, and strengthen anti-money laundering oversight 1.
Regulators cited dealings with unregistered overseas virtual asset service providers, plus recurring breakdowns in customer identity verification/know-your-customer (KYC) procedures 2.
Financial Intelligence Unit (FIU) action against Bithumb follows inspections of large exchanges and earlier steps against rivals such as Upbit and Korbit 3.

South Korea is building a model for tightening crypto oversight without a full shutdown

Penalties against Bithumb restrict activity for new users, while existing customers can keep trading and moving funds 2.
Enforcement also targets individuals. Regulators issued a reprimand warning to Bithumb’s CEO and sought the dismissal of the compliance reporting officer, rather than stating definitively that the officer was dismissed 2.
Ongoing scrutiny of the country’s second-largest exchange could lock in more market power for Upbit, which already reports higher user counts and trading volumes 4.
The mix of stricter licensing checks, proposed ownership limits, and operational restrictions offers a possible playbook for governments that want tighter crypto rules without an outright ban 5.