Seoul Administrative Court Grants Bithumb Stay, Pausing FIU Six-Month Partial Suspension

A Seoul Administrative Court has granted Bithumb a stay of execution that pauses enforcement of a six-month partial business suspension while the case proceeds, according to multiple reports.

“Bithumb scores a legal win in South Korea as six-month suspension is lifted by local judge South Korea's financial watchdog imposed a $24”

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Decrypt said the Seoul Administrative Court granted a stay “Thursday,” pending a final ruling, and quoted Judge Gong Hyeon-jin’s reasoning that restricting Bithumb’s “core functions remained restricted” could cause “potential irreparable harm.”

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The Korea Herald similarly said the court accepted Bithumb’s request to suspend the partial business suspension imposed by the Financial Intelligence Unit (FIU), allowing the exchange to continue operations pending a final ruling.

The Block reported that the Seoul Administrative Court’s 2nd Administrative Division, led by Judge Gong Hyeon-jin, approved the request on Thursday, pausing the partial business suspension imposed by the FIU.

CoinDesk also described the ruling as an overturning of the six-month partial business suspension, citing Yonhap News and saying there was “no clarification on whether a 36.8 billion won ($24.6 million) fine is also on hold.”

Across the coverage, the suspension was tied to an FIU action in March and was originally scheduled to take effect on March 27, with Bithumb filing for an injunction on March 23.

The Korea Herald added that the partial suspension would have halted the transfer of external virtual assets for new customers, and that it would have been “the harshest sanction ever imposed on a Korean won-based cryptocurrency exchange.”

The court fight centers on sanctions imposed by South Korea’s Financial Intelligence Unit in March, with regulators alleging millions of compliance failures under the Act on Reporting and Using Specified Financial Transaction Information.

Decrypt said the FIU imposed the sanctions in March after alleging 6.65 million violations of local anti-money laundering rules, and it broke down the figure into 3.55 million failures to verify customer identities and 3.04 million cases where Bithumb failed to block restricted transactions.

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CoinDesk similarly said the sanctions stemmed from violations of the Act on Reporting and Using Specified Financial Transaction Information, and it described the FIU’s breakdown as 3.55 million failures to carry out required customer identity verification and 3.04 million related to cases where the exchange failed to properly block transactions that should have been blocked.

The Block reported that the FIU initially sent Bithumb a suspension notice in March that would have halted external cryptocurrency deposits and withdrawals for new customers, and it said the FIU also imposed a fine of 36.8 billion won ($25 million).

The Korea Herald described the fine as 36.8 billion won and said the FIU cited Bithumb’s failure to comply with obligations to verify the identities of its users in about 6.65 million cases, including failure to block transactions with unregistered virtual asset operators.

Multiple outlets also tied the sanctions to specific operational restrictions, with The Block saying the six-month suspension would have halted external cryptocurrency deposits and withdrawals for new customers.

CoinCentral added that regulators imposed the sanction over alleged compliance failures and that the court would review the case, while also noting that the enforcement would have blocked new users from depositing or withdrawing digital assets.

In addition to the suspension and fine, Decrypt said CEO Lee Jae-won faced disciplinary action, and it described the suspension as “the most severe penalty ever imposed on a Korean won-based exchange.”

Judge Gong Hyeon-jin’s role appears repeatedly across the reporting, with courts and outlets emphasizing the potential harm of restricting Bithumb’s operations.

“Summary - The Seoul Administrative Court granted Bithumb’s request to suspend enforcement of its six-month partial business suspension, leaving the sanction on hold until a ruling in the main case”

bloomingbit

Decrypt said Judge Gong Hyeon-jin cited “potential irreparable harm to the exchange if core functions remained restricted,” and it described the stay as an emergency injunction that blocked enforcement of the six-month partial business suspension.

The Block likewise said the Seoul Administrative Court’s 2nd Administrative Division, led by Judge Gong Hyeon-jin, approved the request on Thursday, and it characterized the decision as pausing enforcement until the court reaches a final judgment.

CoinCentral described the same stay as a temporary relief from a six-month operational restriction, stating that the ruling halts enforcement of the suspension until the court reaches a final judgment.

Decrypt also included the court’s reasoning about what functions would still be possible and what would be restricted, quoting: “While trading within the exchange and Korean won conversions remain possible, inter-exchange transactions and external virtual asset transfers are also core functions.”

It continued with the court’s expectation that “Restrictions on these alone are expected to cause difficulties in attracting new customers.”

Decrypt added that the court considered upcoming regulatory changes that could affect Bithumb’s competitive position, noting that “listed corporations and registered professional investment corporations” will be able to participate in the virtual asset market “soon.”

It further quoted the court’s view that if sanctions remained, “it will inevitably have a negative impact on Bithumb’s ability to secure these new clients.”

Bithumb’s public stance in the reporting is that it will continue presenting its position through the remaining legal proceedings while challenging both the suspension and related enforcement measures.

The Korea Herald quoted Bithumb saying, “We plan to faithfully present our position throughout the remaining legal proceedings,” and it placed that statement alongside the court’s decision to temporarily halt the FIU’s six-month partial business suspension.

CoinCentral

The Block likewise reported that Bithumb said it planned to “faithfully present” its position throughout the remaining legal proceedings, and it said the exchange had been expected to challenge the fine as well.

Decrypt said Bithumb had requested the court end both the suspension and fine on March 23, just days before the penalties were set to take effect March 27.

CoinDesk described Bithumb as filing a request with the court to end the suspension and fine imposed by the FIU in March, and it said there was no clarification on whether the fine was also on hold.

CryptoPotato said Bithumb won a temporary lifeline as the court halted the six-month ban, offering relief to the platform as it challenges regulatory action.

CoinCentral added that Bithumb continues to challenge both the sanction and related enforcement measures in court, and it said the court paused enforcement of the suspension until a final judgment.

Across these accounts, the legal timeline is anchored by March 23 filings and the March 27 scheduled start that was interrupted by the stay decision.

The stay arrives amid other regulatory and legal pressure on Bithumb, including scrutiny tied to a separate payout mistake and sector-wide oversight.

“Bithumb scores a legal win in South Korea as six-month suspension is lifted by local judge South Korea's financial watchdog imposed a $24”

CoinDesk

Decrypt said Bithumb’s court victory comes as it faces intensifying regulatory scrutiny, following an incident in February when the exchange mistakenly credited hundreds of users with 2,000 BTC instead of 2,000 won in a promotion, and it said lawmakers criticized regulators over missing the structural issues that led to Bithumb’s accounting error.

CoinDesk

Decrypt also said the exchange later filed to seize Bitcoin from users who refused to return mistakenly credited funds, and it noted that South Korean authorities have halted crypto lending services industry-wide, citing leverage concerns.

The Block described the same “fat-finger” error, saying it mistakenly distributed a theoretical 620,000 BTC to users as part of an internal promotional campaign, and it said the exchange said it has since recovered most of the smaller amount of funds actually claimed.

CryptoPotato provided additional detail on the February promotional event, saying Bithumb planned to send a total of 620,000 won to 249 users, but due to an input error it processed the payments in BTC, which “briefly resulted in an unusually large transfer before it was reversed within minutes.”

It also said Bithumb asked the court to freeze 7 BTC that had not been returned and that it pursued a provisional seizure to secure the remaining Bitcoin.

Crypto.news added that regulators tightened oversight across the sector after the payout error, and it said the Financial Services Commission directed exchanges to strengthen real-time monitoring of large transactions after an emergency inspection identified vulnerabilities in automated settlement systems.

MEXC Exchange reported that the FIU’s action was overturned by a South Korean court but said Bithumb faced “fresh headaches” from separate allegations of massive AML failures, while also pointing to the February incident and the Financial Services Commission inspection.

The Korea Herald framed the broader context as heavy penalties imposed since early last year on won-based crypto exchanges, and it said the ruling was likely to raise further questions over the legal basis of the FIU’s sanctions approach.