South Korea Bans 14 Mobile Crypto Apps From Apple's App Store Targeting KuCoin, MEXC, and Other Unregistered VASPs

Today, South Korea's Financial Intelligence Unit (FIU), operating under the Financial Services Commission (FSC), intensified its regulatory actions by blocking access to 14 mobile applications

Today, South Korea’s Financial Intelligence Unit (FIU), operating under the Financial Services Commission (FSC), has stepped up its regulatory actions by blocking access to 14 mobile applications on Apple’s App Store. These apps were operated by ‘unregistered’ foreign Virtual Asset Service Providers (VASPs), including exchanges such as KuCoin and MEXC.

The country’s financial intelligence agency has also threatened to take legal action against any bank that facilitates the use of unregistered crypto platforms.

The move comes after the FIU, in collaboration with Google, restricted 17 unregistered crypto apps on the Google Play Store in late March.

How Strict Are South Korea’s Crypto Rules?

The country is known for its strict financial regulations, extending to the crypto industry. South Korea mandates that all VASPs offering services to its residents must register with the FIU, complying with the Specific Financial Transaction Information Reporting and Use Act. Failure to do so could lead to huge penalties, including fines of up to 50 million won (roughly $37,000) or imprisonment for up to five years.

Combining the previous crypto app ban on the Google Play Store and today’s Apple App Store, the blocked applications include services from exchanges like KuCoin, MEXC, Phemex, CoinEx, and Poloniex.

According to the statement released by the South Korean authorities, the aim of blocking these apps is to curtail the operations of unregistered platforms within the country. All these restrictions and regulations are a way for law enforcement to prevent money laundering, protect investors, and maintain market integrity.

What Compliance Hurdles Do Crypto Firms Face?

FIU’s monitoring and enforcement of the rules are likely to continue. Currently, those who wish to use cryptocurrency exchanges must complete the procedures for verifying their accounts using real-name bank accounts. Meanwhile, exchanges are required to set up strong Anti-money laundering (AML) and Know Your Customer (KYC) protocols.

The mentioned VASPs must obtain ISMS certification from the Korea Internet & Security Agency (KISA), and they are obligated to follow the Financial Action Task Force (FATF) guidelines. This means that VASPs must collect and share specific information about the originator and beneficiary for virtual asset transfers exceeding 1 million won (around $800).

In addition, the country has a ban on institutional crypto trading, but the plan is to slowly remove the limitations during this year. This phased rollout will allow non-profits, universities, law enforcement agencies, and listed companies to trade crypto assets.

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