Domestic Companies’ $15B North Korea Trade
Korean Crypto Exchanges Linked to North korean Money Laundering
Table of Contents
- Korean Crypto Exchanges Linked to North korean Money Laundering
- Korean Crypto Exchanges and north Korean Money Laundering: A Q&A
- What’s the story about Korean crypto exchanges and North korean money laundering?
- Why is this a major concern?
- Which South Korean exchanges are involved?
- What is Huion Crypto and the Huion Group?
- Is Huion Crypto involved in other types of fraud?
- How does North Korea connect to Huion Crypto?
- What is “chain hopping,” and why is it relevant?
- Do South korean regulations address this issue?
- How have the exchanges responded to these allegations?
- Can you summarize the key differences between Bithumb and Upbit’s transactions with huion Crypto?
SEOUL, South Korea (2025-05-09) – South Korean virtual asset exchanges are facing scrutiny after revelations of transactions with a Cambodia-based exchange, Huion Crypto, allegedly used by North Korea for money laundering. While U.S. authorities have flagged Huion Group, the parent company of huion Crypto, as a “major money laundering concern,” South Korean regulations have yet to catch up, raising concerns about potential loopholes.
Bithumb‘s Important Transactions
According to data presented by Democratic Party representative Park Sang-hyuk on Thursday, Bithumb, a major South Korean virtual asset exchange, conducted transactions totaling $1,031,860.40 with Huion Crypto.
Upbit’s Smaller Involvement
Upbit, another leading South Korean exchange, also engaged with Huion Crypto, with transactions amounting to $60,483 between January and March 2023. While Upbit is the largest exchange in South Korea, its trading volume with Huion Crypto was significantly less, approximately one-tenth of Bithumb’s. Upbit reported that deposits and withdrawals related to Huion Crypto did not exceed 1 million won.
Huion Group’s Notorious Reputation
Huion Crypto is operated by the Huion Group, an entity known for facilitating money laundering for criminal organizations. The Huion Group operates a suite of services catering to online fraud, including the Huion Pay electronic payment service and the Huion Guarantee illegal online platform.
Southeast Asia Hub for Online Fraud
Huion Guarantee serves as a hub in Southeast Asia where criminal organizations involved in activities such as voice phishing and romance scams buy and sell AI tools and fake social media accounts. profits from these fraudulent activities are then laundered through Huion Crypto.
North Korean connection
The Lazarus Group, a hacking collective linked to North Korea’s reconnaissance bureau, has also reportedly utilized Huion Crypto. Funds obtained from the hacking of the Japanese virtual asset exchange DMM Bitcoin were allegedly transferred to Huion. The U.S. Treasury Department has designated Huion Group as a “major funding concern,” prohibiting U.S. financial institutions from engaging in transactions with the company.
Chain Hopping Tactics
International criminal organizations, including North Korea, are known to employ ”chain hopping,” a technique involving the conversion of funds into various virtual assets across multiple exchanges and wallets to obscure their origin. Andrew Man, a blockchain analytical analyst with National Security Facts, stated that North Korea uses chain hopping to make tracking funds more difficult.
Regulatory Concerns
South Korean financial authorities mandate domestic virtual asset exchanges to block transactions with non-compliant virtual asset operators to combat money laundering. However,these regulations do not extend to overseas exchanges like Huion Crypto,which do not directly serve South Korean users,raising questions about the effectiveness of current measures.
Exchanges Respond
A Bithumb official stated that the exchange is fulfilling its anti-money laundering obligations under the Special Financial Information Law but noted the difficulty in restricting deposits and withdrawals without explicit requests or incidents flagged by financial authorities. An Upbit official saeid the exchange recognized the money laundering risks associated with Huion and reported the activity to financial authorities, later blocking virtual asset transfers to related wallets.
Korean Crypto Exchanges and north Korean Money Laundering: A Q&A
What’s the story about Korean crypto exchanges and North korean money laundering?
South Korean virtual asset exchanges are under scrutiny due to their alleged transactions wiht Huion Crypto, a Cambodia-based exchange. The suspicion is that Huion Crypto is being used by North Korea for money laundering. This is based on information provided by democratic Party representative Park Sang-hyuk.
Why is this a major concern?
This is a major concern because the U.S. authorities have flagged Huion Group, the parent company of Huion Crypto, as a “major money laundering concern”. However, South Korean regulations haven’t caught up, perhaps creating loopholes that allow illicit activities to continue.
Which South Korean exchanges are involved?
The two main South Korean exchanges mentioned in the provided content are:
Bithumb: Conducted transactions totaling $1,031,860.40 with Huion Crypto.
upbit: Also engaged with Huion crypto, totaling $60,483 worth of transactions between January and March 2023. While Upbit is the largest exchange in South Korea, its trading volume with Huion Crypto was significantly lower than Bithumb’s – approximately one-tenth of the amount.
What is Huion Crypto and the Huion Group?
Huion Crypto is a cryptocurrency exchange operated by the Huion Group. The Huion Group is known for facilitating money laundering activities for criminal organizations. They operate a suite of services that cater to online fraud, including the Huion Pay electronic payment service and the Huion Guarantee platform.
Is Huion Crypto involved in other types of fraud?
Yes, huion Guarantee serves as a hub in Southeast Asia for various online fraud activities. Criminal organizations use this platform to buy and sell AI tools and fake social media accounts. Profits from activities like voice phishing and romance scams are then laundered through Huion Crypto.
How does North Korea connect to Huion Crypto?
The Lazarus group, a hacking collective linked to North korea’s reconnaissance bureau, has allegedly used Huion Crypto. Funds obtained from hacking the Japanese virtual asset exchange DMM Bitcoin were reportedly transferred to Huion. The U.S.Treasury Department has also designated Huion Group as a “major funding concern,” preventing U.S.financial institutions from engaging in transactions with the company.
What is “chain hopping,” and why is it relevant?
“Chain hopping” is a technique used by international criminal organizations, including North Korea, to obscure the origin of funds. It involves converting funds into various virtual assets across multiple exchanges and wallets. Andrew Man, a blockchain analytical analyst, confirmed that North Korea uses this tactic to complicate fund tracking.
Do South korean regulations address this issue?
South Korean financial authorities mandate that domestic virtual asset exchanges block transactions with non-compliant virtual asset operators to combat money laundering. However, these regulations do not currently extend to overseas exchanges like Huion crypto, potentially allowing illicit transactions to continue.
How have the exchanges responded to these allegations?
Bithumb: A Bithumb official stated that the exchange complies with anti-money laundering obligations under the Special Financial Information Law.However, they noted the difficulty in restricting deposits and withdrawals without explicit requests or incidents flagged by the financial authorities.
Upbit: An Upbit official stated that the exchange acknowledges the money laundering risks associated with Huion and reported the activity to financial authorities. upbit later blocked any virtual asset transfers to related wallets.
Can you summarize the key differences between Bithumb and Upbit’s transactions with huion Crypto?
| Feature | Bithumb | Upbit |
| ——————– | —————————————- | ————————————— |
| Transaction Amount | $1,031,860.40 | $60,483 |
| Time Period | Not specified in the provided content. | january - March 2023 |
| Exchange Size | Major South Korean Exchange | Largest exchange in South Korea |
| Response | Fulfilling AML obligations. | Recognized risks, reported to authorities. |