Upbit Dodges 35.2 Billion Won Bullet as Dunamu’s Appeal Puts Penalty on Ice
South Korea's crypto heavyweight catches a break—for now.
A massive 35.2 billion won regulatory penalty has been temporarily suspended. The exchange's parent company, Dunamu, filed an appeal, hitting the pause button on what would have been a landmark financial sanction in the local digital asset space.
The Legal Maneuver
This isn't a dismissal; it's a procedural timeout. The appeal triggers an automatic stay, freezing the penalty's enforcement while the courts review the case. It's a classic legal play—buy time, reassess strategy, and fight another day. The move highlights the complex, often glacial, dance between fast-moving crypto firms and established regulatory frameworks.
Market Implications
For traders and the broader Korean market, the suspension removes an immediate overhang. A penalty of that size—roughly tens of millions of dollars—isn't just a line item; it's capital that could be deployed elsewhere, from security upgrades to new market listings. The reprieve allows Upbit to operate without the immediate financial strain, a crucial factor in the hyper-competitive exchange landscape.
Regulators on Watch
The case is being closely watched as a bellwether. How the judiciary interprets the Financial Services Commission's (FSC) actions could set a precedent for future enforcement. A final ruling against Upbit would signal a hardening regulatory stance. A win for Dunamu could embolden other platforms to challenge sanctions, arguing for more nuanced rules tailored to crypto's unique mechanics—not just legacy finance templates with a digital coat of paint.
The bottom line? In crypto, the only thing faster than a market crash is a lawyer's bill when regulators come knocking. This fight is far from over, but for today, Upbit lives to trade another day.
Dunamu receives record fine, faces business suspension
The FIU decided to impose a 35.2 billion won fine on Dunamu in November of last year. The agency claimed to have discovered that the company had breached the Act on Reporting and Use of Specified Financial Transaction Information (the “Specified Financial Information Act”). Separately from the fine, Dunamu has also received a business suspension order for violating the Specified Financial Information Act.
The 35.2 billion won fine marked the largest ever imposed by financial authorities for violating the Specific Financial Information Act.
The agency accused Dunamu of violating customer verification obligations in 5.3 million cases, including accepting scanned or printed copies of identification documents instead of originals and rendering names or resident registration numbers unidentifiable. It also charged Dunamu with approving registrations even when customers uploaded identification documents online that were out of focus.
Financial authorities explained that approximately 3.3 million cases involved transactions for customers whose verification processes had not been completed.
The authorities also found 15 cases where Dunamu failed to fulfill its obligation to report when there were reasonable grounds to suspect money laundering. This includes instances in which prosecutors sought search-and-seizure orders for the transaction records of Upbit users suspected of criminal activity. Dunamu did not submit the needed reports, despite being aware of this.
At a hearing held in December last year, Dunamu’s legal representative argued, “Even though other exchanges faced the same issues, only Dunamu was subjected to preemptive action,” pointing to a lack of fairness.
Dunamu also argued at the hearing that a violation of Article 8 of the Specified Financial Information Act may result in a fine regardless of deliberate or egregious negligence. The business also asserted that it is a major issue to issue a business suspension order based solely on a single Article 8 infraction.
FIU fines Bithumb, Korbit for AML violations
After FIU imposed a fine on Dunamu in November of last year, it also stated in a separate statement that it had inspected four additional cryptocurrency exchanges, including Bithumb, Coinone, Korbit, and GOPAX, to evaluate their AML and other regulatory compliance.
FIU inspected Bithumb in March 2025. Last month, CCN reported that FIU fined Bithumb for anti-money laundering (AML) violations. The report noted that the FIU examination found numerous compliance issues at Bithumb, including violations of AML procedures, insufficient know-your-customer (KYC) procedures, and failures to report suspicious transactions.
According to industry reports, widespread AML errors akin to those at Upbit have been identified, even if the precise fine amount has not yet been officially announced as of February 2026.
The report stated that Bithumb is expected to pay a large fine, which is predicted to equal or exceed Upbit’s $25 million fine.
The Financial Intelligence Unit (FIU) issued an institutional warning and fined South Korean cryptocurrency exchange Korbit 2.73 billion won ($1.9 million) on December 31, 2025, for numerous violations of anti-money laundering (AML) laws.
The FIU imposed disciplinary measures against the exchange’s top compliance staff, in addition to the monetary fine, including issuing a warning to the CEO and reprimanding the AML officer.
The penalties followed regulators’ findings of serious flaws in Korbit’s AML compliance system, the result of a thorough on-site investigation conducted between October 16 and October 29, 2024. According to the FIU’s investigation, Korbit had violated almost 22,000 rules about transaction limitations and customer due diligence.
Cryptopolitan reported that regulators also identified 19 improperly reported virtual asset transactions involving three foreign virtual asset service providers (VASPs). The report noted that Korea’s regulations governing the management of unregistered foreign corporations were broken in this case.
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