South Korean Regulator Blocks Key Exchange Apps from KuCoin and MEXC
14.04.2025 18:25
South Korean financial authorities have ordered the blocking of Apple Apps used by 14 unreported foreign virtual asset operators, including prominent crypto exchanges KuCoin and MEXC. The action, taken by the Financial Intelligence Unit (FIU) as part of broader efforts to clamp down on unreported business activities, is aimed at curbing money laundering risks and protecting users. This move follows similar measures last month when regulators requested Google to block access to several crypto-related apps. The FIU statement emphasized that overseas crypto operators must report their domestic activities in accordance with the Act on Reporting and Use of Specific Financial Transaction Information, noting that failure to do so may lead to criminal consequences. The crackdown reflects South Korea’s increasing scrutiny and regulatory tightening within the crypto sector to enforce compliance and transparency.
The regulatory action blocking KuCoin's app is likely to exert immediate bearish pressure on KCS, as investor sentiment turns cautious amid compliance and operational concerns. In the short-term, reduced trading activity may contribute to a drop in token demand, while long-term impacts will depend on KuCoin’s ability to align with regulatory requirements and restore market confidence. Historical parallels indicate that such enforcement events typically trigger initial sell-offs followed by potential stabilization if corrective measures are implemented.
The blockage of MEXC's app is expected to negatively affect MX in the near term, as market participants react to the increased regulatory scrutiny and potential disruptions in trading. The immediate impact may be a decline in liquidity and investor hesitation, with the possibility of recovery if MEXC quickly resolves its compliance issues. Long-term recovery for MX will hinge on the exchange’s ability to navigate South Korean regulation and re-establish trusted operational practices, as similar past incidents have shown an initial negative reaction with gradual stabilization over time.
Sources
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