South Korean Crypto Exchange Giant Bithumb Fined $24,800,000 Over Alleged Customer Verification Failures

South Korean financial regulators have reportedly fined the crypto exchange Bithumb a hefty sum of 37 billion won ($24.8 million) due to alleged customer verification lapses. The country’s Financial Intelligence Unit (FIU) has accused Bithumb of failing to verify the identity of its customers in over 6.59 million instances. Additionally, they have been accused of facilitating approximately 45,000 transactions with 18 unregistered exchanges overseas.

In response to these allegations, the FIU has decided to impose a six-month partial business suspension on Bithumb, along with the hefty fine. Bithumb’s CEO, Lee Jae-won, is also set to receive an official reprimand from the regulator. However, the exchange has been given a 10-day window to respond to the fine before it is officially finalized.

This crackdown on Bithumb comes at a time when crypto ownership is on the rise in South Korea. Last year, it was reported that 16.29 million people had opened accounts on the country’s top five domestic crypto exchanges. Industry experts predicted that the number of crypto investors in South Korea could soon reach 20 million, despite the overall population of the country being nearly 52 million.

As of March 2024, there were reportedly 14 million crypto investors in South Korea, with over 500,000 new investors entering the market in November of the same year. Interestingly, this was also the month when Donald Trump won the US presidential election, a time when he expressed support for cryptocurrencies during his campaign.

It is evident that the crypto market in South Korea is experiencing significant growth, attracting a large number of investors. The crackdown on Bithumb serves as a reminder of the importance of adhering to regulatory standards in the rapidly evolving cryptocurrency industry.

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