Bithumb and Korea FIU hold first administrative hearing; dispute centers on the regulatory basis for small transfers and a 6-month business suspension

AT A GLANCE

Bithumb and Korea FIU hold first administrative hearing, with the dispute focusing on the regulatory basis for small transfers and the 6-month penalty.

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【Bithumb First administrative hearing: claims insufficient 1000000 regulatory framework for Korean won transfers】

The Seoul Administrative Court's Second Panel held the first hearing in the administrative lawsuit between October 22 concerning Bithumb and the Korea Financial Intelligence Unit (FIU).FIU found that Bithumb engaged in August 28, 2022 to April 3, 2025 transfers with 18 unreported virtual asset service providers during the period, and imposed penalties on that basis, including a partial business suspension restricting new customers from transferring virtual assets externally for 45,772 6 months.Bithumb stated in court that transfers of 1000000 Korean won or more were subject to the “Travel Rule,” and that unreported operators had already been excluded from the list of available exchanges, so there were zero non-compliant outbound transfers in that amount range. Transfers below 1000000 Korean won were not subject to the Travel Rule at the time; the platform had no legal basis to require customers to provide information on the receiving exchange, and the regulatory authorities had not clearly specified how such transfers should be blocked.Bithumb also stated that after integrating with Chainalysis API only approximately 2%of the unidentifiable addresses were subsequently determined to be FIU designated unreported operators. If all such transfers had been blocked, the remaining 98%legitimate transactions would also have been affected, and the platform could have faced user claims.Bithumb also argued that the 6-month penalty was excessive, effectively preventing the platform from acquiring new customers. The company also questioned the reasonableness of FIU standards for identifying overseas operators and the basis for the penalty.

Key points

The Seoul Administrative Court's Second Panel held the first hearing on October 22 in the administrative lawsuit between Bithumb and the Korea Financial Intelligence Unit (FIU).
FIU found that Bithumb engaged in transfers with August 28, 2022 to April 3, 2025 during 18 unreported virtual asset service providers, involving 45,772 transfers.
FIU The penalty included a partial business suspension restricting new customers from transferring virtual assets externally for 6 months.
Bithumb stated in court that transfers of 1000000 Korean won or more were subject to the “Travel Rule,” with zero non-compliant outbound transfers in that amount range.
Bithumb stated that transfers below 1000000 Korean won were not subject to the Travel Rule at the time; the platform had no legal basis to require customers to provide information on the receiving exchange, and the regulatory authorities had not clearly specified how such transfers should be blocked.
Bithumb stated that after integrating with Chainalysis API approximately 2%of the unidentifiable addresses were subsequently determined to be FIU designated unreported operators.
Bithumb argued that the 6-month penalty was excessive and questioned FIU standards for identifying overseas operators and the reasonableness of the basis for the penalty.

AI-assisted interpretation

The following is analysis, separate from reported facts. Verify important claims independently.

This case concerns whether a trading platform should block transfers to unreported operators.FIU argued that Bithumb there were a large number of such transfers and imposed a penalty;Bithumb argued that transfers below 1000000 Korean won were subject to unclear rules and implementation procedures at the time. The regulatory gap, zero non-compliant transfers, and 2%are all Bithumb side's statements in court, not the court's conclusions.

Why it matters to readers

The dispute concerns whether Bithumb can continue acquiring new customers normally, and also how the platform should identify and handle transfers below 1000000 Korean won to unreported operators.

Beginners should distinguish between the regulator's findings, the platform's defense, and the court's final ruling; current reports concern only the first hearing, and no party's position should be treated as conclusive.

Risks and unknowns

The court has not yet issued a final ruling.
Bithumb The claims concerning the regulatory gap, zero non-compliant outbound transfers, and the proportion of identified addresses have not yet been confirmed by the court.
FIU The specific standards for identifying overseas operators and whether the basis for the penalty is reasonable remain disputed.
6 It remains unclear whether the partial business suspension for which months will be upheld, adjusted, or revoked.
The original text does not specify the arrangements for subsequent court hearings.

Bithumb and Korea FIU hold first administrative hearing; dispute centers on the regulatory basis for small transfers and a 6-month business suspension

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