Bithumb, South Korea’s second-largest cryptocurrency exchange, will shut down its USDT market and order book sharing with Australia’s Stellar Exchange in just two months amid anti-money laundering scrutiny from regulators.
The closure took effect at 11 a.m. Friday and affected 10 cryptocurrencies traded on the USDT market.
Regulatory investigation causes closure
The Korean Financial Intelligence Unit (FIU) began an on-site investigation into Bithumb on October 1, 2025. The investigation focused on whether exchanges’ order book sharing could create loopholes in anti-money laundering protocols. The FIU investigated weaknesses in customer verification procedures and travel rule compliance, particularly when working with overseas exchanges that do not meet South Korea’s strict standards.
The Travel Rule is a global requirement that forces virtual asset service providers to collect and share details of senders and recipients of certain cryptocurrency transactions. South Korean regulators were concerned that Bithumb’s partnership with Stellar Exchange could allow users to circumvent these rules through cross-border transactions.
Industry sources said the investigation lasted significantly longer than usual. The extended review has increased operational pressure on Bithumb.
Short-term partnership with Stellar Exchange
On September 22, 2025, Bithumb announced the beta version of the USDT market and collaborated with Stellar Exchange to increase liquidity by sharing the order book. This arrangement pooled trading volume and gave users deeper market access.
But concerns soon arose. It was revealed that BingX staff worked at Bithumb’s Seoul headquarters during the partnership, raising questions about the scope of oversight and regulation. Stellar Exchange is a subsidiary of BingX, a Singapore-based platform.
South Korea has implemented a virtual asset user protection law based on the Financial Services Commission’s strict rules on asset management, customer protection, and transaction monitoring. Authorities are concerned that cross-border partnerships with foreign companies within South Korea could pose complex compliance challenges, particularly in anti-money laundering and identity verification enforcement.
User impact and industry outlook
All outstanding USDT market orders on Bithumb will be canceled upon termination and API services related to the market will be suspended. The 10 affected cryptocurrencies can still be traded in Korean won. Deposit and withdrawal functions are still available to users.
Bithumb said in an official notice that the closure aims to provide a more stable and advanced trading environment through system improvements. The exchange said it would provide updates on the reopening, but did not provide a timeline.
But observers see the closure as a direct response to regulatory requirements rather than a voluntary upgrade. The move was driven by FIU concerns over anti-money laundering regulations, the report said.
This case illustrates the hurdles crypto exchanges face when expanding their services internationally in countries where there is intense scrutiny. South Korea prioritizes investor protection and crime prevention, and requires strict compliance.
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