South Korea Imposes Three-Month Suspension on Upbit for Compliance Failures

South Korean regulators have imposed a three-month partial suspension on Upbit due to compliance failures. Key points include:

Restrictions on new user transactions from March 7 to June 6, 2025.
Violations related to unregistered businesses and customer verification.
Failure to meet anti-money laundering (AML) and Know Your Customer (KYC) standards.
Existing users can trade but cannot transfer virtual assets to or from external wallets.
Financial penalties and internal reviews are forthcoming, which may affect Upbit's market position.
Upbit plans to enhance compliance measures in response to the regulatory action.
The suspension follows increased regulatory scrutiny and an ongoing antitrust investigation.
Over 30% of the population in South Korea invests in digital assets, prompting tighter regulations.
Upbit has previously faced issues with 700,000 KYC violations.
Future adjustments to restrictions may occur through further regulatory discussions.
Upbit was the first South Korean exchange to issue a public disclosure under the Virtual Asset User Protection Act.

These developments come as South Korea prepares to implement a more stringent crypto regulatory framework by the second half of 2025.