Coinone’s chief executive is facing an official reprimand after South Korean regulators took issue with the crypto exchange over a series of compliance lapses, including tens of thousands of unverified user accounts and repeated transactions with unlicensed foreign platforms.
Regulator cites tens of thousands of violations
South Korea’s Financial Intelligence Unit under the Financial Services Commission found that Coinone failed to verify users’ identities in around 70,000 cases.
The exchange was also accused of completing customer verification records even when key information was missing – and allowing transactions to continue for customers whose identity checks were never completed.
According to several South Korean media outlets, the FIU reported more than 10,000 transactions made with 16 foreign exchanges that were not registered with South Korean regulators. Regulators had already warned Coinone about these transactions. The exchange continued anyway.
South Korea’s FIU fined Coinone $4 million and imposed a three-month partial suspension on the exchange for AML violations.
New customers will no longer be able to access crypto deposits and withdrawals starting April 29.
– Token Metrics (@tokenmetricsinc) April 13, 2026
The FIU fined Coinone 5.2 billion won, or approximately $3.5 million. A three-month partial suspension of activities was also imposed, preventing new customers from depositing or withdrawing funds for the duration of the ban.
CEO Cha Myung-hoon received a formal reprimand, although reports indicate it carries no criminal weight – the action is administrative in nature. Coinone has 10 days to contest the sanctions before they are finalized.
Second major exchange in a month
This is not the first time that South Korean authorities have attacked a major exchange in recent weeks. In March, Bithumb – the country’s second-largest crypto platform by trading volume – was fined $24 million and given a six-month partial suspension for similar anti-money laundering failures.
The action came after Bithumb made headlines for a costly hardware error: The exchange accidentally sent its customers 620,000 Bitcoins, valued at the time at around $42 billion, instead of 620,000 Korean won.
The mistake prompted the Bank of Korea to call on lawmakers to impose tighter controls on stock exchanges, including restrictions on trading that could come in the event of unusual market activity or sharp price swings.
The exchange, ranked third in South Korea by size, now joins Bithumb as a target in what appears to be a growing regulatory push against crypto platforms in the country.
Officials said Monday that lawmakers should consider mechanisms for stopping trade linked to abnormal activity — a proposal that indicates authorities are considering structural solutions, not just fines.
How Coinone responds to the FIU’s action within its 10-day deadline will likely determine how the final sanctions are drafted.
Featured image from Unsplash, chart from TradingView
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