Bithumb, South Korea’s second-largest cryptocurrency exchange, suddenly announced the termination of its USDT trading market, effective 11:00 AM on Friday, November 28. The exchange also canceled the sharing of its Order Book with Australia’s Stellar Exchange, despite the partnership having only been operational for two months.
🚨 Pressure from FIU: AML and Travel Rule Scrutiny
The suspension of USDT trading occurs amid an intensive investigation by South Korea’s Financial Intelligence Unit (FIU) into Anti-Money Laundering (AML) and Know Your Customer (KYC) compliance.
The FIU has been auditing Bithumb since October 1, 2025, to assess whether sharing Order Books with foreign exchanges could create loopholes for circumventing strict Korean AML and KYC laws. The FIU is paying particular attention to the rigor of identity verification procedures and compliance with the Travel Rule, a crucial mandate for tracking cross-border transactions.
The unusually lengthy investigation has put continuous pressure on Bithumb, ultimately leading to the decision to dissolve the controversial partnership.
🤝 International Collaboration Under Regulatory Fire
Bithumb initially launched the USDT beta market on September 22, 2025, in partnership with Stellar Exchange to enhance market liquidity. However, this collaboration quickly drew scrutiny after reports emerged that personnel from BingX (Stellar’s parent company based in Singapore) were working at Bithumb’s headquarters in Seoul. This prompted regulators to question the transparency and the associated risks of cooperating with foreign entities.
South Korea is known for having one of the strictest digital asset regulatory environments globally, governed by user protection laws and the Financial Services Commission (FSC). Any cross-border collaboration is subject to meticulous review, especially regarding AML, KYC, and user data management.
While Bithumb publicly stated that the closure was part of its efforts to “stabilize the system,” experts agree that this move is a direct capitulation to regulatory pressure. The incident highlights the major challenges faced by Korean exchanges, where cross-border cooperation intended to boost liquidity quickly turns into a significant legal risk in a jurisdiction prioritizing financial security.
