A South Korean court has temporarily lifted the ban on attracting new clients for the cryptocurrency exchange Upbit amid ongoing litigation.
Background of the Ban
On February 25, South Korea’s Financial Intelligence Unit (FIU) imposed a three-month ban on deposits and withdrawals for new clients of Upbit due to violations related to unregistered service providers. Upbit’s parent company, Dunamu, filed a lawsuit against FIU, contesting the decision, and obtained a temporary suspension of the ban.
Regulatory Allegations Against Upbit
Upbit is accused of multiple violations, including KYC breaches and anti-monopoly law infractions. FIU found between 500,000 and 600,000 KYC violations. Upbit was also charged with facilitating 45,000 transactions with unregistered foreign crypto exchanges.
New Regulatory Measures in South Korea
On October 25, 2024, Finance Minister Choi Sang-Mok announced new reporting requirements for businesses involved in cross-border digital asset transactions, aiming to enhance oversight of cryptocurrency activities. The FIU also requested Google Play to block apps of 17 crypto exchanges and is working to restrict access through other platforms.
The Upbit situation highlights the strict regulatory measures in South Korea regarding cryptocurrencies, emphasizing the importance of compliance to ensure stability and trust in the industry.
