South Korean financial authorities are preparing to impose sanctions against crypto exchanges that operate illegally in the country, as reported by Hankyung.

The Financial Intelligence Unit (FIU) has identified several exchanges not registered as Virtual Asset Service Providers (VASPs) as targets for sanctions. The specific exchanges noted include BitMEX, KuCoin, CoinW, Bitunix, and KCEX, which have been found to operate Korean-language websites without proper registration with the FIU.

Key Insights:

• Targeted exchanges are classified as illegal businesses due to operating without registration.
• The FIU is evaluating measures to block access to these unregistered overseas exchanges, which offer services to domestic investors, in consultation with the Korea Communications Standards Commission.
• An FIU official stated, “We are organizing damage cases and related data to strengthen communication between authorities, and we expect to see tangible measures taken within this year.”

BitMEX, KuCoin, and CoinW have not responded to requests for comments.

Last month, another South Korean crypto exchange, Upbit, faced restrictions for failing to comply with regulatory obligations, highlighting ongoing scrutiny in the sector.