Austria’s financial regulator has ordered KuCoin EU to stop onboarding new customers across the European Union after key compliance officers left their roles.
Quick Summary – TLDR:
- Austria’s Financial Market Authority has prohibited KuCoin EU from taking on new customers or signing new contracts.
- The regulator said the exchange no longer has required AML and sanctions compliance officers in place.
- The freeze will remain until all key roles are properly filled and approved.
- KuCoin says it is actively hiring and rebuilding its compliance team in Vienna.
What Happened?
Austria’s Financial Market Authority, known as the FMA, has barred KuCoin EU from conducting new business after identifying gaps in its anti-money laundering and sanctions oversight staffing. The Vienna based entity can continue serving existing clients but cannot onboard new users or launch new products.
The regulator said the restrictions will stay in place until the required compliance functions are restored in line with Austrian law and MiCA rules.
NEWS: KuCoin EU ordered to halt new business by Austria’s FMA over compliance staffing gaps. pic.twitter.com/xkNBtGpkwh
— CoinGecko (@coingecko) February 23, 2026
Compliance Gaps Trigger Immediate Action
The FMA confirmed that KuCoin EU no longer has approved anti money laundering officers and sanctions compliance officers in place, including their designated deputies. These roles are mandatory under the Markets in Crypto Assets regulation and Austria’s Financial Markets Anti Money Laundering Act.
“The effective staffing of these key functions is a prerequisite for the orderly conduct of business,” the FMA said.
According to the regulator, KuCoin EU is “prohibited with immediate effect from concluding business relationships of any kind with new customers and from concluding new contracts or new products within the scope of existing business relationships until these key functions have been appropriately filled.”
The decision comes just months after KuCoin EU secured its MiCA license in November, allowing the exchange to passport services across the European Union and the European Economic Area. At the time of approval, the FMA confirmed that all required compliance positions were properly staffed.
“According to the FMA’s knowledge, this is no longer the case,” the regulator later stated.
KuCoin Says Hiring Is Underway
KuCoin acknowledged that two compliance professionals responsible for AML and sanctions oversight had recently departed. Sabina Liu, managing director of KuCoin EU, said staff mobility is common in regulated industries and stressed that recruitment had already begun before the regulator issued its notice.
She said the exchange had voluntarily paused new user onboarding and certain trading activities.
Liu also described the issue as contained and limited in scope, adding that the company does not expect any long term structural impact on its broader European strategy.
Vienna Emerges as a Crypto Hub Under MiCA
Austria has become an attractive base for crypto firms seeking EU wide access under MiCA. Companies including Bitpanda, Bybit and Bitget have established operations in Vienna to benefit from passporting rights across the bloc.
KuCoin, originally founded in China in 2017 and headquartered in Seychelles, has grown into one of the largest offshore crypto exchanges. It ranks among the top ten platforms by trading volume and recently reported more than $1.25 trillion in centralized exchange trading volume in 2025.
The FMA’s intervention highlights how closely regulators are monitoring governance standards under the new MiCA framework. Across Europe, authorities have warned crypto asset service providers that failure to maintain authorization requirements could lead to business restrictions or forced wind downs ahead of transitional deadlines in 2026.
SQ Magazine’s Takeaway
I see this as a clear message from European regulators that MiCA approval is not a one time achievement. It is an ongoing responsibility. Even large exchanges with strong trading volumes are expected to maintain strict compliance staffing at all times.
If crypto firms want access to the European market, they must treat governance and AML oversight as core infrastructure, not just a regulatory checkbox. This move shows the EU is serious about building a transparent and accountable crypto environment.
