Weekly Global Crypto Crackdown Recap: Brazil, Korea, Panama & More

Brazil Upholds Ban on Cryptocurrency Rewards for World ID Due to Privacy Concerns

Brazil’s National Data Protection Authority (ANDP) has upheld a ban on cryptocurrency compensation for participants in the World ID project, citing significant privacy concerns. This decision follows an investigation launched in November 2024, which raised issues regarding user consent and the irreversible nature of biometric data collection through iris scans. The country's regulatory body emphasized that financial incentives could distort users’ decisions and that any consent must be “free, informed, and unequivocal,” in accordance with Brazilian law. Tools for Humanity, the project’s developer, has not had its petition to review the ban approved, and non-compliance could result in fines of 50,000 Brazilian reais (approximately $8,800) per day. Additionally, Brazil is tightening regulations on stablecoins due to concerns over money laundering and tax evasion, potentially limiting them to self-custody wallets and raising concerns among industry players about stifling innovation.

South Korea Blocks 17 Overseas Crypto Exchange Apps in Registration Crackdown

South Korea's Financial Intelligence Unit (FIU) has blocked access to 17 overseas crypto exchange apps, including KuCoin and MEXC, for failing to secure proper registration, as announced on March 26, 2025. This action aims to mitigate money laundering risks and safeguard users from unregulated platforms. Users are advised to withdraw their assets from unregistered exchanges that fail to meet regulations, which stipulate registration for platforms targeting Korean users or processing transactions in Korean won. The FIU warns that operators of unregistered exchanges face severe penalties, including imprisonment and substantial fines. The crackdown follows a significant surge in crypto participation, with over 9.6 million South Koreans holding accounts in major licensed exchanges by the end of 2024, marking a 52.6% increase. Notably, older investors are a fast-growing demographic, with a significant concentration of wealth among users over 50. Total crypto holdings have surpassed 100 trillion won, reflecting robust market confidence.

Panama Proposes Draft Bill to Legalize Cryptocurrencies and Regulate Blockchain Services

Panama has proposed a comprehensive draft bill to regulate cryptocurrencies and promote blockchain services, positioning the nation as a fintech leader in Latin America. The legislation aims to legally recognize digital assets, allowing their use in financial transactions with mutual agreement between parties. It authorizes cryptocurrencies like Bitcoin and Ethereum for purchasing goods and services, contingent on both parties' consent. The bill introduces a regulatory framework for Virtual Asset Service Providers (VASPs), requiring registration and adherence to Know-Your-Customer (KYC) and anti-money laundering (AML) regulations. Unregistered entities face potential penalties. Additionally, the draft encourages blockchain application in governance, aiming to improve public administration efficiency through digital identity systems and the issuance of tokenized securities. It also recognizes smart contracts as legally enforceable. This initiative seeks to address prior concerns regarding regulatory gaps, outlining the roles of authorities like the Financial Analysis Unit and the Superintendency of Banks of Panama before proceeding to the National Assembly for further consideration.

Thailand SEC Files Criminal Complaint Against Unlicensed Crypto Exchange OKX

Thailand’s Securities and Exchange Commission (SEC) has filed a criminal complaint against OKX, a major unlicensed crypto exchange, for offering trading services since 2021 without necessary approval. The SEC claims OKX promoted its services through various social media platforms, charging a 0.1% trading fee, which breaches the Emergency Decree on Digital Asset Businesses. Nine individuals linked to the platform are also accused of facilitating these operations. The case is under review by the Economic Crime Suppression Division, with potential hefty penalties looming. The SEC warns investors of risks associated with unlicensed exchanges, emphasizing the need for regulatory compliance.

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