Popular cryptocurrency exchange in South Korea, Upbit has allegedly received a suspension notice. According to a local news source, Upbit received the notice for reportedly violating Know Your Customer (KYC) regulations.
As reported, the Financial Intelligence Unit (FIU) of South Korea’s Financial Services Commission (FSC) sent a notification to the exchange on the potential consequence of not complying with KYC regulations. As revealed in the notification, FIU and FSC sought the suspension of new users’ registration on Upbit for six months. However, users already existing on the exchange platform before this notification are not affected.
According to the report, Upbit Exchange has the authority to review the restrictions and give feedback to FIU on January 20. The Financial Intelligence Unit plans to make the final decision on the penalty on the 21st of January.
Upbit bypassed 600,000 KYC identification process
Meanwhile, Upbit’s alleged KYC violation was first reported by South Korean authorities in November 2024. As revealed, the violation was detected while reviewing the exchange business license which was due for renewal. Upon investigation, authorities found out that there were about 600,000 cases of breached KYC. Know Your Customer, KYC is a process implemented to prevent money laundering and terrorism in the region.
The virtual asset industry is currently on the lookout for the fines and sanctions to be imposed on Upbit. In addition, attention is also drawn to the impact of the sanction on the renewal of the exchange license which has been due for renewal since last year October.
According to the South Korean Special Fines Act, organizations can pay up to 100 million won per case for violating of customer identification obligations. Similarly, the region’s Special Money Act also stipulates that virtual businesses must be registered in the country before they are allowed to carry out their operations.
Read More: