South Korea's Money Laundering Watchdog Flags 16 Crypto Firms for Operating Without Registration

Crypto exchanges KuCoin and Poloniex are among the foreign firms accused of conducting "illegal business activities" without proper registration, and could face fines or imprisonment.

AccessTimeIconAug 18, 2022 at 11:29 a.m. UTC
Updated May 11, 2023 at 3:56 p.m. UTC
Drive the Crypto Policy Conversation Forward
October 24, 2023 • Convene • Washington D.C.Where the industry establishes the digital economy’s legal, regulatory and compliance best practices for the future.Register Now

South Korea's anti-money laundering authority is going after 16 foreign crypto firms it says have been operating in the country without proper regulatory approval, a statement published Thursday shows.

The Korea Financial Intelligence Unit (KoFIU), part of South Korea's Financial Services Commission (FSC), said the firms had advertised crypto and offered services to Koreans without obtaining the requisite registration.

The firms it said were conducting "illegal business activities" are KuCoin, MEXC, Phemex,, Bitrue,, Bitglobal, CoinW, CoinEX, AAX, ZoomEX, Poloniex, BTCEX, BTCC, DigiFinex and Pionex.

The country's registration requirement for crypto firms took effect in September with the enactment of the Financial Transaction Reports Act. Efforts to crack down on the industry have intensified following May's fall of Terraform Labs, founded by Korean native Do Kwon. Prosecutors have raided seven exchanges since Terra's collapse. Earlier this month, the FSC said it will help expedite new rules to rein in the crypto industry.

The KoFIU has notified authorities the 16 firms allegedly violated their "registration duties" and that it plans to alert financial authorities in the countries where the companies are based. Violation of the registration requirements carry a maximum sentence of five years in prison or a fine of up to 50 million South Korean won (US$38,000). The firms will also not be allowed to register as a virtual asset service provider (VASP) in the country for an unspecified period of time.

"The KoFIU has requested the Korea Communications Commission and the Korea Communications Standards Commission to block domestic access to the websites of unregistered VASPs to prevent the use of virtual asset services provided by unregistered entities," the statement said.

Credit card transfers and transfers of crypto assets to and from the unregistered firms will be blocked "to disable their use in domestic market."

The agency also warned crypto users against engaging with unregistered platforms, which could leave users "vulnerable to risks of personal information breach and hacking."


Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.

Sandali Handagama

Sandali Handagama is CoinDesk's deputy managing editor for policy and regulations, EMEA. She does not own any crypto.

Learn more about Consensus 2024, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to to register and buy your pass now.