Bithumb administrative lawsuit held for the first time: claims that transfers of less than 1 million Korean won have regulatory gaps

According to South Korean media Digital Asset, the Second Division of the Seoul Administrative Court held its first hearing on October 22 regarding the administrative lawsuit between Bithumb and the Financial Intelligence Unit of Korea (FIU). The FIU determined that between August 28, 2022, and April 3, 2025, Bithumb conducted 45,772 transactions with 18 unreported cryptocurrency operators, and based on this, imposed sanctions, including a partial suspension that restricts new customers from transferring cryptocurrency assets externally for six months.

Bithumb stated in court that transactions of 1 million won or more are subject to the "travel rule," and unreported operators have been excluded from the list of optional exchanges, thus the number of violations for this amount range is zero. Transactions below 1 million won were not subject to the travel rule at that time, and the platform had no legal basis to require customers to provide information about the receiving exchange, nor did the regulatory authorities specify a blocking method. Bithumb also mentioned that after integrating the Chainalysis API, only about 2% of the addresses that could not be confirmed were later identified as unreported operators designated by the FIU. If all were blocked, the remaining 98% of normal transactions would be affected, and the platform could also face user claims.

Bithumb also believes that the six-month sanction is excessive, effectively equivalent to prohibiting the platform from acquiring new customers. The company also questioned the FIU's criteria for identifying overseas operators and the reasonableness of the basis for the sanctions.