KuCoin, MEXC, BitMart, Phemex and BingX are among 27 unregistered crypto platforms whose websites will be blocked for users in South Korea, the Financial Services Commission (FSC) announced on Oct. 13. It is the first measure against such operators to target their websites; earlier steps included referrals to investigators and limits on paying them by credit card.
According to the FSC, South Korea’s media and communications standards regulator reviewed block requests from the Financial Intelligence Unit (FIU), which sits inside the FSC, over two sessions on Oct. 6 and 7 and approved them. Overseas-run sites face an access block; Korea-based ones face termination of service.
The list also names XT.com, Bitrue, Poloniex, BTCC, Pionex, WEEX and six sites listed under Korean names. The FIU did not say when the blocks take effect.
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Blocking Before Losses Are Reported
The FIU said it now plans to request a block as soon as it detects unregistered activity, without first waiting for investigation results, a judicial ruling or confirmed customer losses. It added that it will keep checking for replacement sites that operators open under new addresses and send those for review as well.
Under Korea’s Act on Reporting and Using Specified Financial Transaction Information, any firm offering crypto services to Korean residents must register with the FIU, which requires ISMS security certification among other conditions. Foreign firms are covered if they run a Korean-language site, market to Korean customers or accept won payments. Operating without registration carries up to five years in prison or a fine of up to 50 million won.
The FIU counts 28 registered virtual asset service providers and has reported 44 unregistered operators to investigative agencies so far. The regulator also pointed to a June joint investigation by the Digital Asset eXchange Alliance (DAXA) and registered firms, which found unregistered operators charging average trading fees of 1.5% to 10%, against an average of 0.16% at Korea’s five won-trading exchanges.
From App Stores to Websites
Google and Apple, acting on FIU requests, already block new installs of and updates to unregistered operators’ apps for Korean users. With the new decision, the FSC said, websites are now covered as well.
The FIU told customers of unregistered operators to withdraw their assets immediately and said DAXA will guide users through withdrawal steps with the operators’ cooperation. It also warned that sharing referral links for such platforms could be treated as helping run an unregistered business, exposing the referrer to criminal penalties.
The blocks land as the FSC also weighs changes to how exchanges are supervised, including whether to allow crypto market making.
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