🌎 Upbit Faces Suspension Over KYC Violations

South Korea’s Largest Crypto Exchange Upbit Faces Suspension Over KYC Violations

South Korea’s Financial Intelligence Unit (FIU) has issued a notice to Upbit, the country’s largest cryptocurrency exchange, warning of a potential suspension due to the exchange’s failure to properly implement Know Your Customer (KYC) processes and adhere to Anti-Money Laundering (AML) obligations.

The notice, issued on January 9, threatens a suspension of up to six months, during which time Upbit will not be allowed to onboard new customers. However, existing users will be permitted to continue trading. The exchange has until January 20 to respond to the FIU’s findings, after which the regulator will make a final decision on the suspension.

Investigation into Unregistered Foreign Crypto Firms

In addition to the potential suspension, the FIU is also investigating whether Upbit violated any rules by conducting business with unregistered foreign cryptocurrency firms. Upbit has stated that it was challenging to identify foreign exchanges ahead of time but maintains that there was no intention to break the law.

The potential suspension is a result of Upbit’s failure to comply with KYC requirements, which are in place to prevent money laundering and other illicit activities. The exchange could face fines of up to 100 million Korean won (approximately $71,500) per case, potentially accumulating to 35.8 billion Korean won ($27 million) due to the high volume of cases involved.

Upbit’s situation highlights the importance of adhering to regulatory requirements in the cryptocurrency industry.

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