Korean Crypto Exchanges Block Huione Transfers After 1,400-Fold Surge Raises Laundering Fears

12.8 billion won in transfers puts Cambodia links under scrutiny

Transfers between South Korea's five major cryptocurrency exchanges and Cambodia's Huione Guarantee reached 12.8 billion won in 2024, roughly 1,400 times the level recorded in 2023, according to Financial Supervisory Service data. About 99.9 percent of the transfers used Tether, the cryptocurrency known as USDT that aims to maintain the value of one US dollar.

Bithumb accounted for 12.4 billion won of the 2024 activity. Transfers across the Korean platforms totaled another 3.15 billion won from January 1 through October 20, 2025, a period during which exchanges began blocking the Cambodian venue. By October 27, the Korean exchanges had shut off all transfers to Huione Guarantee.

Regulators and lawmakers fear that domestic cryptocurrency platforms were used for money laundering and illegal remittances connected to criminal groups operating in Cambodia. Money laundering means moving criminal proceeds through transactions that make their origins harder to identify. Cambodia's online scam operations have harmed people across the region, including Koreans.

The scrutiny reaches beyond cryptocurrency exchanges. Cambodian branches of four Korean banks paid about 1.45 billion won in deposit interest to Prince Group, another Cambodian conglomerate suspected of links to criminal activity. Roughly 91 billion won in its deposits have been frozen under international sanctions.

The case connects three developments: growing use of dollar stablecoins for international transfers, the expansion of online scam operations in Southeast Asia, and cryptocurrency transactions involving state backed hackers such as North Korea's Lazarus group. Korean authorities are responding with transfer restrictions, planned account freezes and proposals to strengthen supervision of bank branches overseas.

Where the transfers were concentrated

Bithumb's transfers with Huione Guarantee rose from 9.22 million won in 2023 to 12.4 billion won in 2024. That made it by far the largest Korean platform involved in the recorded activity. Upbit, which recorded no such traffic in 2023, handled 366.9 million won in inflows and outflows in 2024.

Coinone recorded about 1.2 million won in 2024, while Korbit recorded about 11.9 million won. Gopax recorded none. The figures describe money moving between platforms in both directions, rather than only money sent from South Korea to Cambodia.

The distribution changed in 2025, although Bithumb remained the largest participant. From January 1 through October 20, Bithumb handled roughly 2.18 billion won, followed by Upbit with about 523 million won and Korbit with about 443 million won. Coinone's total was about 280,000 won.

The 3.15 billion won recorded during that period was still far above the 2023 baseline. The total covers months before and after the exchanges introduced their restrictions; no breakdown was given showing when individual transfers occurred within that period.

The concentration matters for the response. Bithumb's 12.4 billion won accounted for nearly all the 12.8 billion won recorded in 2024, while the other exchanges had smaller, and very different, levels of exposure. The common feature was the currency used: almost all of the 2024 transfers were in USDT.

When Korean exchanges imposed their blocks

Upbit suspended transfers with Huione Guarantee in March 2025, according to industry sources. Bithumb, Coinone and Korbit followed in May, with their full bans taking effect early that month.

Dunamu, Upbit's operator, reported Huione linked activity to financial authorities, identified associated cryptocurrency wallets and blocked all transfers to the exchange. Bithumb also blocked transactions with Byex, an exchange tied to Prince Group, after receiving a small amount in late 2024.

The sequence of the transfers and restrictions stretches across three years:

• 2023: Bithumb recorded 9.22 million won in transfers with Huione Guarantee, while Upbit recorded none.
• 2024: Transfers across the five major Korean exchanges reached 12.8 billion won. Bithumb also received a small amount from Byex late in the year.
• March 2025: Upbit suspended transfers with Huione Guarantee.
• Early May 2025: Bithumb, Coinone and Korbit imposed full bans.
• May 2025: The US Financial Crimes Enforcement Network identified Huione Group as a primary money laundering concern and proposed restricting its access to the US financial system.
• October 20, 2025: The Korean transfer data for the year reached its reporting cutoff, with 3.15 billion won recorded since January 1.

The exchange response relies on identifying wallets connected to a risky counterparty and preventing transfers involving them. Wallet blacklists and transfer controls allow platforms to cut off venues that fail compliance checks. Their usefulness depends on how accurately exchanges identify the wallets and related services involved.

What the US Treasury found about Huione

Huione Group, the Phnom Penh based parent of Huione Guarantee, is a Cambodian financial conglomerate whose payment services and online marketplaces have drawn scrutiny from regulators. Its network includes Huione Pay PLC, Huione Crypto and a Chinese language marketplace also referred to as Haowang. Huione Guarantee is believed to be a core venue for high risk virtual asset flows.

In May 2025, the US Treasury's Financial Crimes Enforcement Network, known as FinCEN, issued a money laundering finding under Section 311 of the USA PATRIOT Act. It identified Huione Group as a financial institution of primary money laundering concern and proposed prohibiting US financial institutions from opening or maintaining accounts for it.

FinCEN, the US Treasury agency responsible for the finding, summarized its action and the reason for the proposed restriction:

FinCEN identifies Cambodia based Huione Group as a financial institution of primary money laundering concern and has proposed to cut off its access to the US financial system.

FinCEN said Huione Group laundered at least $4 billion in illicit proceeds between August 2021 and January 2025. That included at least $37 million from North Korean cyber heists and $36 million from virtual currency investment scams, often described as pig butchering schemes.

The agency identified poor know your customer and anti money laundering controls among the group's components as factors that increased the risks. Know your customer checks establish who a customer is, while anti money laundering controls look for suspicious activity and require firms to report it.

British authorities have also sanctioned Huione Group over alleged laundering of digital assets connected to fraud and theft. US and UK action has increased pressure on the group as Korean authorities examine domestic platforms' exposure.

Why the proposed US restrictions matter

Section 311 allows the US Treasury to designate a foreign institution as a primary money laundering concern and impose restrictions on its access to the US financial system. FinCEN's May action paired that finding with a proposed rule intended to cut Huione Group off from US financial institutions.

Once a final rule is in place, dollar clearing becomes difficult or impossible for the targeted institution. Dollar clearing is the process through which financial institutions settle payments in dollars. Global banks and payment providers also tend to reduce their exposure to a targeted network, raising operating costs for it and for those transacting with it.

Sanctions can also push activity toward channels that are harder to police. As access to formal banking narrows, transactions may move through other wallets, platforms or payment arrangements. That makes identifying the wider network important alongside blocking a named business.

Cambodia's scam operations and the North Korean connection

Cambodia has become a center for large online fraud complexes involved in investment and romance scams, money laundering and trading in stolen data. Investigators and compliance researchers have documented forced labor in compounds where people from across Asia are coerced into carrying out cyber scams.

Those operations depend on moving money quickly and finding markets where cryptocurrency can be exchanged for other assets or cash. Dollar stablecoins provide a way to transfer proceeds across borders and reach buyers and brokers in different countries.

North Korea's Lazarus group and associated actors have long used cryptocurrency to bypass sanctions. FinCEN's tracing of tens of millions of dollars from North Korean cyber thefts through Huione linked services has deepened concern in Seoul that some Korean transfers may have intersected with networks tied to state backed hacking.

Marketplace operators have also used mirror sites and new channels to keep processing funds after takedowns. A mirror site reproduces a service at another internet address, allowing activity to continue when an earlier site is removed. This pattern makes enforcement more difficult and can prolong the operation of criminal networks.

Tether, the issuer of USDT, has publicly said it can freeze funds connected to theft or sanctions when it receives sufficient evidence. Such freezes can interrupt attempts to convert cryptocurrency into cash and help preserve evidence for law enforcement. Criminals can respond by moving to different wallets, platforms or tokens.

Why USDT dominated the transfers

USDT aims to maintain a value of one US dollar and is traded on almost every major cryptocurrency exchange, as well as through thousands of over the counter brokers across Asia. These brokers arrange transactions directly rather than through an exchange's public trading market.

The stablecoin offers high liquidity, meaning users can generally find buyers and sellers readily. Small spreads, the gap between buying and selling prices, and swift settlement also make it attractive for trading and remittances. The same speed and access appeal to criminals moving proceeds across borders.

About 99.9 percent of the 2024 transfers between the Korean exchanges and Huione Guarantee used USDT. The figure shows how heavily this particular connection depended on a single dollar pegged token.

Criminal users can divide USDT into many smaller transactions, move it quickly and convert it through markets where people trade directly with one another. Those markets can rely less on bank accounts than conventional international payments.

Investigators have a different advantage: cryptocurrency transactions are recorded on a public ledger. Exchanges can flag or block associated wallets, and issuers can freeze certain funds. Effective action still requires tools to analyze transactions, reliable identification of wallet owners and cooperation among authorities in different jurisdictions.

Korean banks face questions over Prince Group deposits

Cambodian branches of Jeonbuk Bank, KB Kookmin Bank, Shinhan Bank and Woori Bank paid about 1.45 billion won in deposit interest to Prince Group. Roughly 91 billion won in the conglomerate's deposits have been frozen under international sanctions.

Korean lawmakers have questioned whether local bank branches were used as conduits for money laundering. They have called for a thorough investigation of controls at branch level and the reporting of suspicious activity. The banking questions sit alongside the cryptocurrency restrictions involving Byex and Huione Guarantee.

The Financial Supervisory Service has acknowledged a lack of direct oversight over Korean banks' overseas branches. It intends to seek legislative changes establishing explicit supervisory authority, reporting obligations and faster sharing of information about risks crossing national borders.

The Financial Services Commission has pledged preemptive account freezes aimed at proceeds belonging to Cambodian criminal groups. For banks and exchanges, that places attention on how quickly suspicious accounts can be identified and restricted while information is passed to the relevant authorities.

What the response means for platforms and users

Korean cryptocurrency platforms can strengthen suspicious transaction reporting and their implementation of the Travel Rule. The rule requires information about the sender and recipient to accompany cryptocurrency transfers, helping institutions identify who is moving funds and where the funds are going.

Regulators can reinforce those checks through account freezes for sanctioned counterparties, closer screening of overseas bank branches and direct cooperation with Cambodian authorities. Sharing data with foreign regulators and private teams that analyze blockchain transactions can help identify connections that cross national boundaries.

Exchanges and payment firms also need closer checks when funds pass through high risk venues. Monitoring groups of wallets connected to known scam networks can reveal links that a single wallet address would miss. Clear procedures for freezing funds and reporting suspicious activity help firms act when those links are found.

Retail users and over the counter brokers face practical risks when dealing with counterparties that appear on sanctions lists or have been flagged by exchanges. A transfer involving such a counterparty can run into restrictions even when the user expects an ordinary payment.

• Check whether a destination wallet has been linked to Huione or another sanctioned entity before sending funds.
• Be wary of requests to convert large sums into USDT for quick international delivery, especially when someone insists on a deal outside an exchange.
• Use alerts from blockchain analysis services where available to identify exposure to known scam networks or mixers, services that combine cryptocurrency flows to make tracing harder.
• Respond promptly to exchange notices about blocked transfers or wallet screening alerts, and provide requested documentation.

The Korean case brings exchange screening, stablecoin controls and overseas bank supervision into the same investigation. Domestic transfer bans address access through Korean platforms, while the proposed legal changes focus on the authorities' ability to monitor and respond to activity involving bank branches abroad.

Key Points

• Transfers between Korea's five major exchanges and Huione Guarantee reached 12.8 billion won in 2024, roughly 1,400 times the 2023 level.
• Bithumb handled 12.4 billion won of the 2024 total, and about 99.9 percent of all recorded transfers used USDT.
• Transfers totaled 3.15 billion won from January 1 through October 20, 2025. Upbit imposed its block in March, followed by Bithumb, Coinone and Korbit in May.
• FinCEN said Huione Group laundered at least $4 billion between August 2021 and January 2025, including money from North Korean cyber thefts and cryptocurrency investment scams.
• FinCEN proposed cutting Huione Group off from the US financial system under Section 311 of the USA PATRIOT Act. British authorities have also sanctioned the group.
• Four Korean banks' Cambodian branches paid about 1.45 billion won in interest to Prince Group, whose deposits of roughly 91 billion won have been frozen.
• Korean authorities have pledged preemptive account freezes and plan legislative changes to strengthen supervision of overseas bank branches.