South Korea’s Financial Intelligence Unit (FIU) has ordered access restrictions on 27 websites operated by unregistered overseas cryptocurrency exchanges, including KuCoin, MEXC, Phemex, BingX, and BitMart. The country’s communications review body approved these measures following reviews conducted on October 6 and 7, extending enforcement beyond mobile applications to web platforms. Authorities assess whether exchanges operate locally based on factors such as Korean-language websites, marketing targeting South Korean users, and support for payments in won. This action follows previous efforts, including an August 2022 attempt to block 16 platforms and a March 2025 restriction of 17 unregistered apps on Google Play. In November 2025, authorities outlined further anti-money laundering measures, including plans to extend transaction reporting requirements to transfers below 1 million won. The FIU warned that users could face difficulties accessing funds or making withdrawals due to the new restrictions.
The expansion of website blocking signifies a strategic shift in South Korea's regulatory approach, moving from app-store limitations to direct infrastructure censorship. By targeting the web presence of major offshore exchanges like KuCoin and BitMart, the FIU aims to sever the primary channels through which unregistered entities market to and serve local users. This move underscores the government's determination to enforce strict registration requirements, treating any digital footprint tailored to Korean consumers—such as localized language or payment methods—as grounds for regulatory intervention.
From a Compliance perspective, this development highlights the increasing difficulty for global crypto firms to maintain operations in jurisdictions with stringent localization laws without formal licensing. The warning regarding potential withdrawal issues introduces significant operational risk for users, potentially leading to liquidity concerns or asset lockouts if they rely solely on blocked interfaces. For the broader market structure, this reinforces the dominance of registered domestic exchanges while raising barriers for international competitors, effectively creating a walled garden for compliant local players.
