Massive Increase in Cross-Border Stablecoin Transactions
Stablecoin transactions between South Korea’s leading crypto exchanges and Cambodian platforms experienced a significant surge, increasing nearly 1,400 times last year. These figures, disclosed by opposition lawmaker Lee Yang-soo based on data from the Financial Supervisory Service, have ignited concerns regarding potential money laundering activities involving sanctioned entities operating in Cambodia.
According to data cited by Yonhap, transactions between five South Korean exchanges and Huione Guarantee—a firm that has been blacklisted by the United States and the United Kingdom—skyrocketed from a mere 9.22 million won ($6,400) in 2023 to an astonishing 12.8 billion won ($8.93 million) in 2024. The overwhelming majority of these flows, representing 99.9% of the total volume, were conducted using Tether’s USDT stablecoin.
Bithumb Dominates Transaction Volume
Bithumb emerged as the exchange with the highest volume of these transactions, facilitating approximately 12.4 billion won ($8.6 million) in stablecoin transfers to Cambodia. Upbit followed with 366 million won ($254,000), while smaller amounts were processed through Coinone and Korbit. Gopax, according to the report, registered no related activity.
Despite the implementation of exchange restrictions in May 2025, the report indicates that these transfers continued into the current year, suggesting potential loopholes within existing monitoring systems. Regulators are currently reviewing these findings and are contemplating the introduction of more stringent measures to curb cross-border transactions involving sanctioned entities.
Investor Insight
The substantial increase in USDT flows between South Korean and Cambodian platforms highlights the utilization of stablecoins in gray-market transactions that circumvent regulatory oversight.
Huione Guarantee's Alleged Role in Crypto Illicit Activities
Huione Guarantee is reportedly affiliated with Huione Group, a Cambodian conglomerate that has faced sanctions from Washington and London. These sanctions were imposed due to the group's alleged involvement in laundering cryptocurrency assets linked to scams and cybercrime networks. Blockchain analytics reports suggest that the group handled over $94 billion in digital assets prior to the imposition of sanctions.
The company is said to have connections with Cambodia’s ruling Hun family and operates a marketplace accessible via Telegram. This platform allegedly offers services including personal data trading, money laundering, and even the provision of physical restraint devices used in scam operations. Western authorities have characterized the platform as an integral part of a broader ecosystem that facilitates trafficking and financial crime throughout Southeast Asia.
Additionally, another entity named BYEX, which is reportedly linked to Cambodia’s Prince Group, was involved in a smaller transfer of 680,000 won ($470) to Bithumb earlier this year, according to Yonhap.
South Korean Regulatory Response
Lawmakers in South Korea have called for a thorough inquiry into the role played by domestic exchanges in facilitating these transactions. Representative Lee urged regulatory bodies to assess the adequacy of current oversight mechanisms in preventing funds from reaching sanctioned entities.
“Financial authorities must take this matter seriously and strengthen safeguards against crypto-based money laundering,” Lee stated. The Financial Supervisory Service and the Financial Intelligence Unit are reportedly reviewing potential amendments to the Special Financial Transactions Act. The aim is to tighten regulations surrounding virtual asset transfers involving jurisdictions deemed high-risk. Officials are also considering the implementation of new disclosure requirements for stablecoin movements that exceed predefined thresholds.
Investor Insight
South Korea's investigation underscores the escalating tension between fostering crypto innovation and enforcing cross-border regulations, with stablecoins now positioned at the nexus of both legitimate finance and financial crime.
Future Outlook and Regulatory Scrutiny
These revelations emerge as Seoul intensifies its scrutiny of its digital asset markets, following a series of enforcement actions within the region. Officials anticipate that this investigation could lead to the imposition of stricter controls on cross-border transactions and more robust sanctions screening procedures for exchanges.
For the time being, Huione's alleged involvement in channeling billions of dollars through stablecoin channels serves as a stark reminder of how crypto markets continue to function as a conduit for illicit finance, despite increasing global oversight.