South Korea’s top financial watchdog has begun formal sanctions proceedings against Dunamu, the company behind Upbit, the country’s dominant cryptocurrency exchange. The action stems from a 2025 hacking incident that resulted in losses of 44.5 billion won, roughly $32 million.

The Financial Supervisory Service (FSS), which operates under South Korea’s Financial Services Commission (FSC), spent seven months investigating the breach before issuing what’s known as an inspection opinion letter. A sanctions review committee will weigh in, followed by the Securities and Futures Commission (SFC), before any penalties are actually imposed.

South Korea’s Virtual Asset User Protection Act, which governs digital…