The Federal Court of Australia has ordered Oztures Trading Pty Ltd, the company behind Binance Australia Derivatives, to pay 10 million Australian dollars (about $6.9 million USD). The penalty follows the company’s admission that it misclassified 85% of its Australian clients.

 

According to the Australian Securities and Investments Commission (ASIC), around 524 retail investors were incorrectly classified as wholesale clients. Of these, 460 were categorized as sophisticated investors and 33 as wealthy traders between July 2022 and April 2023.

 

ASIC said the misclassification exposed these retail investors to high-risk crypto derivatives they should not have accessed. The regulator reported that the affected investors suffered losses exceeding $6 million and paid roughly $2.6 million in trading fees.

 

In a statement of agreed facts, Binance also admitted to several other compliance failures, including not fully disclosing information to retail clients, failing to maintain a compliant dispute resolution system, and not making a target market determination as an operational crypto entity.

 

Image credit: ASIC

 

Binance, through its Australian entity Oztures, was also found to have failed to comply with the country’s regulator’s requirements regarding employee training.

 

“Binance’s senior compliance staff provided inadequate oversight or review of client applications and supporting documentation, further weakening the onboarding and classification processes,” ASIC wrote on its official website.

 

Binance Previous Settlement With the Australian Regulator

The $6.9 million penalty imposed by the country’s regulator on Binance comes three years after the company paid $9 million in compensation to affected clients.

 

Although the misclassification issue, which began in 2023, was self-identified, Binance had its operating license withdrawn by Australian authorities, in addition to the compensation it paid.

 

Countries Intensify Crackdown on Compliance Violators

The crackdown on Binance’s Australian operations by the country’s financial regulator is one of several regulatory actions targeting crypto firms in recent weeks. Just a few weeks earlier, South Korean regulators fined Bithumb $25 million for anti-money laundering (AML) and compliance violations.

 

Regulators in multiple jurisdictions have taken action against crypto-related companies. 

 

In Canada, the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC), the country’s financial intelligence unit and anti–money laundering regulator, has revoked the registrations of 47 crypto-linked money services businesses this year, accounting for the majority of its 50 total revocations. 

 

The agency has indicated it will continue enforcement actions against non-compliant entities. Prediction market companies have also faced increased regulatory scrutiny, including restrictions and bans, amid concerns over compliance and regulatory violations.

 

 

The Financial Intelligence Unit (FIU), a crime monitoring and prevention body under South Korea’s Financial Services Commission, fined cryptocurrency exchange Bithumb 36 billion won (about $24.5 million) for anti-money laundering (AML) violations.

 

The fine follows an on-site inspection of the exchange conducted by the regulator in March and April last year, which found that Bithumb had violated the Specific Financial Information Act 6.65 million times. The act requires exchanges to restrict transactions with unregistered virtual asset service providers, block suspicious transactions, and verify their customers.

 

Bithumb was also found to have violated the Act on Reporting and Use of Financial Information by facilitating 45,772 cryptocurrency transactions with 18 unregistered overseas virtual asset service providers and cryptocurrency firms. Despite repeated warnings from the regulator, Bithumb failed to take corrective action.

 

"We have continuously requested Bithumb to stop trading with undeclared overseas virtual asset service providers, but it failed to fulfill its legal compliance obligations and demonstrated a markedly insufficient willingness to comply with the law, such as failing to implement effective blocking measures over an extended period," the FIU explained. 

 

In addition to the $24 million fine imposed by the regulator, Bithumb has been ordered to halt all external crypto transfers for new customers from March 27 to Sept. 26. The ban, however, does not affect existing customers trading on the exchange.

 

Despite facing the largest fine ever imposed on a South Korean exchange, Bithumb said it would address the issues highlighted. "We will resolve the issues identified in this inspection and do our best to create a safe trading environment and protect users," the company said.

 

 

South Korea Cracks Down on Compliance Violators

South Korea has been cracking down on compliance violators, particularly cryptocurrency exchanges that breach Anti-Money Laundering (AML) and Know Your Customer (KYC) regulations. In November 2025, the country fined its largest cryptocurrency exchange, Upbit, 35.2 billion won (approximately $25 million) and imposed a three-month partial suspension after the exchange failed to comply with AML and KYC rules.

 

On December 31, 2025, the FIU fined Korbit 2.73 billion won ($1.9 million) and issued a stern institutional warning to the exchange’s executives following a compliance audit that revealed weaknesses in its anti-money laundering (AML) and know-your-customer (KYC) procedures.

 

The FIU is currently conducting an on-site review of Coinone, which is expected to conclude later this year. Although there are unconfirmed reports that the agency has already flagged violations, no official report or penalties have been issued.

 

 

Dubai’s digital asset regulator has instructed KuCoin and all entities associated with the exchange to cease their crypto operations in the Emirates, stating that the platform operated an illegal, unlicensed virtual asset service.

 

In a recent news alert, the Virtual Assets Regulatory Authority (VARA), Dubai’s digital assets regulator, warned residents about the unlicensed crypto operations of KuCoin and its affiliated entities: Phoenixfin Pte Ltd, MEK Global Limited, Peken Global Limited, and KuCoin EU GmbH.

 

Image credit: VARA

 

According to VARA, KuCoin and its entities lacked the necessary regulatory approvals to operate in the region and that they misled the public about their licensing status.

 

"In accordance with Dubai Law No. (4) of 2022 and Cabinet Resolution No. 111/2022, all virtual asset service providers must be licensed to operate legally in this jurisdiction. KuCoin does not meet these legal requirements and is not authorised to provide any virtual asset services in or from Dubai," the regulator said.

 

Since KuCoin lacked the regulatory approval required to operate in the United Arab Emirates, the regulator clarified that any promotion, advertising, or solicitation related to the exchange and its virtual asset products was illegal.

 

Thus, KuCoin has been instructed to cease and desist from all unlicensed virtual asset activities in the region. The regulator also urged Dubai residents and investors to consult its public register of licensed and approved VASPs before engaging with any platform.

 

 

Kucoin’s Rough Edge With Regulatory Compliance

KuCoin has had its own battles with regulatory compliance in recent years. In February 2024, Austria’s Financial Market Authority temporarily restricted the exchange from onboarding new customers to its platform.

 

According to the regulator, KuCoin lacked key compliance personnel responsible for anti-money laundering (AML), counter-terrorist financing (CTF), and sanctions monitoring. The exchange was therefore found to be non-compliant with regulatory obligations under the EU crypto framework. As a result, KuCoin had to temporarily halt its operations until full compliance was achieved.

 

In 2025, Canada’s Financial Transactions and Reports Analysis Centre (FINTRAC) imposed a $19.6 million fine on KuCoin, accusing the exchange of serious anti-money laundering (AML) violations and failing to register as a money services business. The fine came three years after the exchange was permanently banned in Ontario.

 

KuCoin also had to exit the U.S. market in 2025 after being accused of operating an unlicensed money-transmitting business and other anti-money-laundering violations. It paid a $300 million fine and agreed to remain out of the U.S. market for at least two years.

 

 

A Coinbase shareholder has filed a derivative lawsuit against several top executives and board members of the crypto exchange, alleging compliance and disclosure failures by the company’s leadership. 

 

On Tuesday, Kevin Meehan, one of Coinbase’s shareholders, filed a complaint in a U.S. district court in New Jersey. The court filing cited several of Coinbase’s top directors, including CEO Brian Armstrong, co-founder Fred Ehrsam, Chief Legal Officer Paul Grewal, and Chief Financial Officer Alesia Haas, among other executives.

 

Image credit: PACER

 

 

According to the filing, the plaintiff accused the defendants of making false and misleading statements between April 2021, when the exchange became a publicly traded company, and June 2023. The complainant alleged that a compliance failure by the exchange's leadership exposed the company to several stringent regulatory actions.

 

On behalf of Coinbase, the complainant, Kevin, is seeking damages, requesting that the court implement corporate governance reforms, and requesting recovery of any profits the exchange's leadership may have obtained during the period when the exchange faced these compliance cases.

 

However, since this is a shareholder derivative lawsuit, any financial recovery from Coinbase's directors will go to Coinbase rather than directly to the shareholders.

 

 

Coinbase Battle With Compliance

Over the past few years, Coinbase has faced several legal and compliance challenges, paying millions of dollars in damages and penalties. 

 

In January 2023, the New York State Department of Financial Services sued the exchange for major failures in its Anti-Money Laundering (AML) program. The regulator accused Coinbase of having weak Know-Your-Customer (KYC) checks and failing to properly review suspicious transactions.

 

As part of the settlement, Coinbase agreed to pay $100 million: $50 million in penalties and $50 million to improve its compliance checks and systems.

 

In June 2023, Coinbase was hit with a $5 million penalty by the New Jersey Bureau of Securities. The regulator accused the exchange of allowing the trading of unregistered securities on its platform, prompting several other states to impose restrictions on its staking services at the time.

 

Coinbase has also faced legal challenges from the U.S. Securities and Exchange Commission (SEC). In 2023, the SEC filed a lawsuit against the company, alleging it operated an unregistered exchange. Following the announcement, Coinbase’s stock dropped sharply, falling from over $60 to under $50 within minutes of the news breaking.