South Korean financial regulators have reportedly fined cryptocurrency exchange Bithumb 37 billion won ($24.8 million) over alleged customer verification shortcomings.
South Korea’s Financial Intelligence Unit (FIU) accused the exchange of failing to verify the identities of its customers in 6.59 million separate cases, and facilitating about 45,000 transactions with 18 unregistered foreign exchanges, the Seoul-based Yonhap news agency reported.
In addition to the fine, the FIU will also impose a partial business suspension of six months, and Bithumb CEO Lee Jae-won will reportedly receive an “official reprimand.” However, the regulator has given Bithumb ten days to respond to the fine before it is officially finalized.
The FIU crackdown on Bithumb is becoming a reality as crypto ownership explodes across South Korea. Last year, citing data released by the South Korean government, Yonhap reported that 16.29 million people had opened accounts on Upbit, Bithumb, Coinone, Korbit and Gopax, the country’s five largest domestic crypto exchanges, with industry officials predicting that South Korea would soon be home to 20 million crypto investors.
South Koreans with accounts at multiple exchanges were reportedly counted only once to keep the data accurate. The country currently has a total population of almost 52 million.
There were reportedly 14 million crypto investors in South Korea as of March 2024, and more than 500,000 new investors in the country bought crypto in November 2024, the same month Donald Trump won the US presidential election. Trump took a crypto-supportive stance during his presidential campaign.
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