South Korea’s FIU Blocks 27 Unregistered Crypto Exchange Websites

South Korea’s Financial Intelligence Unit (FIU) revealed on Tuesday that domestic access to 27 unregistered offshore cryptocurrency exchange platforms will be blocked. The impacted platforms include KuCoin, MEXC, Phemex, BingX, BitMart, XT.com, Bitrue, CoinW, and BTCC.

The formal directive was issued by the Korea Communications Standards Commission (KCSC), the nation’s internet regulator, following deliberations on October 6 and 7. Under the order, websites featuring domestic servers or operators will face closure, while overseas platforms will have their access blocked within the country.

Additionally, the FIU has reported 44 unregistered operators to investigative authorities. Traders experiencing difficulties withdrawing their funds from these restricted platforms can seek assistance through the Digital Asset Exchange Alliance (DAXA), a self-regulatory organization established by major domestic exchanges.

Most of These Exchanges Have Been on the Radar Since 2022

Back in August 2022, the FIU flagged 16 foreign crypto exchanges to investigators and requested that other government bodies restrict website access. Among those named were KuCoin, MEXC, Phemex, Bitrue, CoinW, and Poloneix, with another six exchanges targeted the following year.

Regulatory pressure has steadily increased since then. The FIU banned credit card purchases of crypto assets on unregistered platforms in May 2024. By March 2025, 14 exchange apps had been removed from Apple’s App Store and 17 from Google Play. Earlier this year in January, Google Play updated its policies to mandate FIU registration for all crypto exchanges and wallets operating in South Korea.

Upbit and Bithumb Stand to Pick Up the Volume

With approximately 27 domestic platforms officially registered with the FIU, South Korea has now blocked a number of offshore exchanges equal to its total pool of compliant local operators. Market activity and trading volume remain heavily concentrated between Upbit and Bithumb. Each time the FIU shuts down an offshore avenue, local traders are increasingly funneled back toward these two compliant exchanges.

While registered Korean exchanges strictly offer spot trading, offshore platforms have historically attracted local users by providing high-leverage perpetual futures. Consequently, the FIU views the ongoing blockades as a vital step toward safeguarding investors and traders.

The FIU Expects Mirror Sites to Keep Appearing

Anticipating that some platforms will attempt to bypass the restrictions, the FIU intends to monitor blocked exchanges that change their domains to resume operations, submitting fresh block requests whenever mirror sites emerge.

Virtual private networks (VPNs) present a greater challenge, as any South Korean trader using a VPN can easily access all 27 sites in a matter of clicks. Furthermore, the latest regulatory decision does not impact existing accounts held on those foreign platforms.

Nevertheless, the new measures significantly increase friction for users. With credit card payments restricted and official app store listings removed, accessing an offshore exchange from South Korea now requires deliberate effort, likely prompting many casual traders to find Upbit the more convenient option.

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