Dunamu granted access to South Korean government data for Upbit KYC verification

Dunamu has achieved a significant milestone as the first cryptocurrency exchange operator in South Korea authorized to utilize the government’s shared administrative information system, providing Upbit with an innovative method for customer verification during KYC processes.

On August 26, Yonhap News Agency reported that South Korea’s Ministry of the Interior and Safety has classified Dunamu as an eligible institution this month after a thorough on-site evaluation in May to ensure compliance with necessary conditions.

This designation permits the Upbit operator to access governmental administrative data for customer verification, thereby minimizing the documentation that users are typically required to provide.

Dunamu Secures Access to Government Data for KYC

The administrative information joint-use service in South Korea was initiated by the Ministry of the Interior and Safety to lessen the paperwork burden associated with various government and approved services.

Through this system, participating institutions can verify existing information from government agencies via a secure government network instead of requiring users to gather and submit documents independently.

According to reports, Dunamu intends to implement this service within its KYC procedures at Upbit. The company anticipates that it will streamline the verification process, making it faster and more precise while decreasing the documentation burden on users.

This approval marks a historic moment as a domestic virtual asset exchange operator is recognized to utilize the system, granting access to a public information infrastructure that is already used in other sectors requiring identity and administrative record verification.

For Upbit users, this change will primarily impact the segments of the KYC process that rely on information accessible through government databases. Dunamu is currently finalizing the necessary preparations to facilitate this service and alleviate the inconvenience linked with the submission of supporting documents.

This new access arises following previous regulatory scrutiny concerning Upbit’s customer verification processes. In January 2025, crypto.news reported on potential penalties after concerns were raised by South Korea’s Financial Intelligence Unit regarding alleged deficiencies in KYC and anti-money laundering compliance.

At that time, the exchange received a procedural sanctions notice and was required to submit its response before regulators could decide on the ultimate action to be taken. Additionally, the renewal of Upbit’s virtual asset service provider license had been under review during the investigation.

Upbit KYC Access Following Prior Compliance Scrutiny

Customer identification plays a crucial role in South Korea’s oversight of virtual asset service providers, as regulators mandate exchanges to verify user identities and fulfill anti-money laundering obligations.

Dunamu’s access to government-held data alters part of the operational workflow by allowing eligible records to be verified via the administrative system. While this designation does not absolve Upbit of its KYC responsibilities, it provides the company with an additional resource for verifying information needed during customer evaluations.

The focus on Dunamu has persisted in other aspects this year. In July, South Korea’s Financial Supervisory Service initiated formal sanction proceedings concerning a significant breach involving Upbit wallets reported in November 2025.

The regulator is examining whether the exchange fulfilled its responsibilities under the Virtual Asset User Protection Act in light of this incident. Upbit compensated affected customers and enhanced portions of its wallet system while authorities continue their review of the situation.

The investigations have also raised inquiries about how existing South Korean virtual asset regulations apply to security breaches, as the current framework lacks specific penalties for hacking incidents.

Dunamu’s public sector involvement expanded in July when the company was designated for crypto custody services by the National Police Agency of South Korea.

The firm was selected as the preferred bidder for a one-year contract to store and manage virtual assets seized during criminal investigations, outpacing competitors K DAC and Hecto Wallet One based on technical and financial assessments.

This police contract pertains to assets held in custody during criminal inquiries, offering the agency an external provider for their management. Some industry stakeholders have questioned whether the procurement criteria favored larger exchange operators, while police confirmed the choice was made through a competitive selection process.

Dunamu Undergoes Major Ownership Review

In addition to its compliance and public sector engagements, Dunamu is involved in a proposed corporate transaction with Naver Financial, which is still pending regulatory approvals.

Completion of this share exchange has been postponed twice, with the latest anticipated closing date now set for December 31. As part of the agreement, Dunamu would become a wholly owned subsidiary of Naver Financial.

A regulatory filing in July maintained the exchange ratio at 2.5422618 shares of Naver Financial for each share of Dunamu, while completion hinges on various approval processes.

The deal still requires review by South Korea’s Fair Trade Commission, approval regarding significant shareholder changes under the Credit Information Act, and necessary notifications in line with laws governing specified financial transaction information.

While regulatory approvals are still awaited, Dunamu indicated that discussions surrounding the proposed Digital Asset Basic Act in South Korea could influence the transaction based on the legislation’s final provisions.

In April, the Financial Supervisory Service instructed Dunamu to rectify certain aspects of its disclosures about the transaction due to identified omissions or inaccuracies regarding future restructuring plans and other investor-relevant information.

Despite the delays, Dunamu and Naver Financial have sustained their commitment to the transaction while South Korean authorities continue scrutinizing its competition, ownership, and implications for the financial sector.

The recent government designation followed an inspection by the Ministry of the Interior and Safety in May and the subsequent eligibility review. With the necessary approval granted, Dunamu intends to leverage the administrative information service for Upbit’s customer verification and is finalizing the required work to implement this new process.