FMA Slams Brakes on KuCoin EU: Austria’s MiCA Trophy Exchange Hit with AML & Sanctions Freeze

Austria’s Austrian Financial Market Authority (FMA) has pulled the emergency brake on MiCA-licensed KuCoin EU Exchange GmbH: the Vienna-based CASP is banned from conducting new business after losing its key AML and sanctions officers. Just weeks after FinTelegram questioned KuCoin’s “Austrian whitewash,” the regulator now publicly confirms serious organisational breaches at its own MiCA showpiece.

Key Facts

• Ban on new business: The FMA has issued an administrative decision prohibiting KuCoin EU Exchange GmbH from entering into any new customer relationships and from offering new contracts or products within existing relationships, after determining that the firm no longer has suitable key function holders for AML and sanctions compliance. The order requires “legal compliance” to be re-established without delay and is not yet legally final.
• Reason: missing AML & sanctions leadership: According to the FMA, the posts of Anti-Money-Laundering Officer, Sanctions Compliance Officer, and their respective deputies are currently not duly staffed. Effective staffing of these key functions is described as a precondition for orderly business operations.
• From fresh licence to enforcement in under 3 months: KuCoin EU received its MiCA authorisation as a crypto-asset service provider on 27 November 2025, with permission to provide multiple services across the EEA via passporting. The new-business ban follows less than three months later, turning a flagship licence into an early MiCA stress test.
• Global enforcement history: In January 2025, KuCoin’s Seychelles operator Peken Global Ltd pleaded guilty in New York to operating an unlicensed money transmitting business and agreed to pay over $297 million in fines and forfeiture, after prosecutors highlighted systemic AML failures and billions in illicit flows through the platform.
• Canadian AML penalty: In July 2025, Canada’s FINTRAC imposed a C$19.6m penalty on KuCoin’s operator for failing to register properly, failing to report large virtual asset transactions thousands of times, and failing to submit suspicious transaction reports in dozens of cases.
• FinTelegram red flags vindicated: FinTelegram’s December 2025 KuCoin dossier questioned whether Vienna was “whitewashing a repeat offender” by granting a MiCA licence to a group with a fresh U.S. criminal plea, a record Canadian AML fine and multiple regulator warnings. A separate Rail Atlas-style report mapped the Austrian KuCoin cluster and opaque Hong Kong ownership.

Read our KuCoin reports here.

Short Analysis

From MiCA trophy to supervisory headache

The FMA proudly put KuCoin EU on its MiCA scoreboard in late November 2025, positioning Vienna as a “European MiCA hub” alongside other CASPs such as Bitpanda, Bybit EU and AMINA. Within weeks of KuCoin EU’s EU-wide launch campaigns, the same regulator has now barred the platform from doing any new business because its AML and sanctions command chain has effectively evaporated.

Formally, this is “just” an organisational finding: missing key function holders under MiCA and the Financial Markets Anti-Money Laundering Act. Substantively, it is devastating. A MiCA CASP that cannot keep its AML and sanctions leadership in place fails the most basic test of prudential seriousness – especially when its global parent has only just admitted to U.S. felony-level compliance failures and is appealing a record AML penalty in Canada.

Vienna’s MiCA experiment under pressure

For Austria, this is more than a single enforcement action. FinTelegram has repeatedly warned that the “Vienna MiCA hub” was drifting towards a rent-a-CEO / rent-a-licence model for high-risk offshore exchanges, with KuCoin as Exhibit A. The FMA’s own decision now confirms that governance at KuCoin EU is fragile enough that its core compliance functions can simply disappear, forcing an immediate business freeze.

The ban is temporary and not yet final; if KuCoin EU swiftly installs acceptable AML and sanctions officers, the FMA could lift the restriction. But the symbolic damage is done: one of MiCA’s highest-profile licences has already triggered an AML-driven new-business ban, less than a year after a U.S. guilty plea and amid ongoing Canadian enforcement. For institutional counterparties and regulators in other EU states, KuCoin EU now looks less like “MiCA-de-risked access” and more like a live-fire test of how the new regime handles repeat-offender risk.

Call for Information (Whistle42)

FinTelegram will continue to track KuCoin EU’s remediation plans, the FMA’s follow-up steps, and any impact on European clients and counterparties. If you work or have worked at KuCoin, KuCoin EU, its Austrian law firms or service providers – or at another EU regulator watching this case closely – we want to hear from you.

Share internal risk reports, correspondence, onboarding memos or AML/sanctions findings securely via Whistle42. Your identity will be treated with the highest level of confidentiality.