South Korea is tightening its grip on crypto exchanges—and this time, Coinone is in the spotlight.
The exchange is facing a heavy penalty after regulators found serious anti-money laundering failures. It’s been hit with a 5.2 billion won (about $3.5 million) fine and a three-month partial suspension of its business.
So, what went wrong?
According to the Financial Intelligence Unit, Coinone failed to properly verify around 70,000 user accounts. That’s a huge gap in basic compliance.
On top of that, the exchange processed over 10,000 transactions linked to 16 unregistered foreign platforms—even after getting multiple warnings. Regulators say Coinone ignored those warnings and kept operating as usual.
It didn’t stop there. Investigators also found that the platform marked some user accounts as “complete” even when key information was missing. In some cases, unverified users were still allowed to trade freely.
Because of this, Coinone is now under strict restrictions. For three months, it won’t be allowed to bring in new customers or let them move funds on the platform.
The company’s CEO, Cha Myung-hoon, has received an official warning. However, regulators made it clear this is not a criminal case—just administrative punishment for now.
Coinone still has a short window—10 days—to challenge the decision before it becomes final.
This isn’t an isolated case. Just last month, Bithumb was also hit hard, with a $24 million fine and a six-month suspension for similar compliance issues.
There’s also been growing pressure after a major mistake at Bithumb, where the exchange accidentally sent out 620,000 Bitcoin instead of 620,000 Korean won—a massive error worth billions.
Now, the Bank of Korea is pushing for even stricter rules. Officials want faster monitoring systems, requiring exchanges to match their records with actual holdings every five minutes instead of once a day.
They’re also suggesting that exchanges should have the power to pause trading during extreme price swings or suspicious activity.
The message is clear: South Korea is no longer taking a relaxed approach. Exchanges are expected to follow the rules—or face serious consequences.
