Upbit, South Korea’s largest crypto exchange, is under investigation for allegedly approving a significant number of accounts without proper identification verification.
Reports indicate that the Financial Services Commission (FSC) has identified between 500,000 and 600,000 violations related to know-your-customer (KYC) regulations during a routine review of license renewals.
According to a report by Maeil Business Newspaper, the FSC discovered cases where user accounts were created using vague identification documents, and other accounts were created without adequate verification processes.
Such violations of KYC rules can result in significant fines, ranging up to 100 million won (approximately $71,740). Additionally, these violations could complicate Upbit’s ongoing efforts to renew its operating license.
As the fifth-largest exchange on CoinMarketCap, Upbit has seen significant trading activity, processing more than $7.7 billion in transactions in the past 24 hours and a total of $48.2 billion in transactions in October alone, according to The Block.
FSC Chairman Kim Byung-hwan has previously emphasized the need for an investigation into monopolistic practices within the South Korean crypto exchange sector, which is largely dominated by Upbit.
The implications of the current investigation could extend beyond financial sanctions, potentially affecting the exchange’s market position and operational capabilities.
