Dunamu has become the first South Korean crypto exchange operator approved to use the government’s shared administrative information system, giving Upbit a new way to verify customer information during KYC checks.
Summary
- Dunamu became the first Korean crypto exchange operator approved to use the government’s administrative information system.
- Upbit plans to use the service for KYC checks and reduce document submissions from customers.
- The approval followed an on site inspection by the Ministry of the Interior and Safety in May.
- Dunamu has also faced regulatory scrutiny over Upbit’s KYC and anti money laundering controls.
Yonhap News Agency reported on Aug. 26 that South Korea’s Ministry of the Interior and Safety designated Dunamu as an eligible institution this month after conducting an on-site inspection in May and reviewing whether the company met the required conditions.
The designation allows the Upbit operator to use administrative information held by government agencies when carrying out customer verification, reducing the amount of supporting documentation users may need to submit themselves.
Dunamu gains access to government data for KYC
South Korea’s administrative information joint-use service was introduced by the Ministry of the Interior and Safety to reduce paperwork required for government and other approved services.
Under the system, participating institutions can check information already held by government agencies through a government network instead of requiring users to obtain and submit the same documents separately.
Dunamu plans to apply the service to its know-your-customer procedures at Upbit, according to the report. The company expects the system to reduce document submissions from users while making its verification process faster and more accurate.
The approval is the first time a domestic virtual asset exchange operator has been designated to use the system, extending access to a public information infrastructure already used in other areas where identity and administrative records need to be verified.
For Upbit users, the change will mainly affect parts of the KYC process that depend on information available through government records. Dunamu said it is completing the preparations needed to use the service and reduce inconvenience linked to submitting supporting documents.
The new access also comes after Upbit faced regulatory scrutiny over its customer verification controls. In January 2025, crypto.news reported potential sanctions after South Korea’s Financial Intelligence Unit raised concerns over alleged failures involving KYC and anti-money laundering requirements.
At the time, the exchange had received a procedural sanctions notice and was required to submit its response before regulators determined the final action. Upbit’s virtual asset service provider license renewal had also remained under review during the investigation.
Upbit KYC access follows earlier compliance scrutiny
Customer identification forms a central part of South Korea’s controls on virtual asset service providers, particularly as regulators require exchanges to verify users and meet anti-money laundering obligations.
Dunamu’s access to government-held information changes part of the operational process by allowing eligible records to be checked through the administrative system. The designation itself does not remove Upbit’s KYC obligations, but it gives the company another source for verifying information required during customer checks.
Regulatory attention on Dunamu has continued in other areas this year. In July, South Korea’s Financial Supervisory Service began a formal sanctions process over a major Upbit wallet breach reported in November 2025.
The regulator had been examining whether the exchange met its responsibilities under the Virtual Asset User Protection Act following the incident. Upbit reimbursed affected customers and rebuilt parts of its wallet system while authorities continued reviewing the case.
The proceedings also exposed questions over how existing South Korean virtual asset law applies to exchange security failures, because the current framework does not contain a separate penalty specifically written for hacking incidents.
Another public-sector role for Dunamu emerged in July when the company was selected for crypto custody by South Korea’s National Police Agency.
Dunamu was named the preferred bidder for a one-year contract to store and manage virtual assets seized by police, placing ahead of K DAC and Hecto Wallet One after technical and price evaluations.
The police contract covers assets taken into custody during criminal investigations and gives the agency an external provider for their management. Some industry participants questioned whether the procurement requirements favored large exchange operators, while police said the bidder had been chosen through a competitive process.
Dunamu also faces major ownership review
Outside its compliance and public-sector work, Dunamu remains involved in a planned corporate transaction with Naver Financial that is still waiting for regulatory approvals.
The companies have postponed completion of their planned share exchange twice, with the latest timetable moving the expected closing date to Dec. 31. Under the transaction, Dunamu would become a wholly owned subsidiary of Naver Financial.
A July regulatory filing kept the exchange ratio at 2.5422618 Naver Financial shares for each Dunamu share, while completion remained dependent on several approval processes.
The deal still requires scrutiny from South Korea’s Fair Trade Commission, approval related to major shareholder changes under the Credit Information Act and notifications required under laws governing specified financial transaction information.
As regulatory approvals remained pending, Dunamu also said discussions over South Korea’s proposed Digital Asset Basic Act could affect the transaction depending on the final legislation.
The Financial Supervisory Service had already ordered Dunamu in April to correct parts of its disclosure on the proposed transaction after finding omissions or inaccuracies involving future restructuring plans and other information considered important to investors.
Dunamu and Naver Financial have kept the transaction in place despite the delays, while South Korean authorities continue reviewing its competition, ownership and financial-sector implications.
The latest government designation followed the Ministry of the Interior and Safety’s May inspection of Dunamu and its subsequent eligibility review. With the approval now granted, the company plans to use the administrative information service during Upbit customer verification and is completing the work required to introduce the new process.
