Austria regulator halts KuCoin EU new business, citing AML and sanctions compliance gaps, raising MiCA enforcement concerns across European markets.
Austria financial watchdog blocked KuCoin EU from starting new business activities. Moreover, the order cited failures in AML and sanctions compliance roles. As a consequence, the Vienna-based crypto exchange is under immediate operation restrictions significant.
Austrian FMA Cites Serious Compliance Deficiencies
The decision was made by the Austrian Financial Market Authority on Thursday. In addition, key control functions were not appropriately staffed, regulators said. Therefore, KuCoin EU no longer had in MiCA fit requirements properly.
Related Reading: KuCoin Europe Secures MiCAR License in Austria | Live Bitcoin News
As a result, the entity is unable to onboard customers or release products. Meanwhile, already existing clients can continue to use already available exchange services. However, new contracts within the existing relationships are, for the time being, strictly forbidden.
The FMA identified vacancies in AML officer/sanctions leadership roles. Furthermore, there were also reported to be missing deputies for these compliance posts. Thus, authorities found that governance controls were inadequate under CASP licensing standards.
KuCoin EU was authorized by MiCA on 11/27/2025 for further European ambitions. However, enforcement was months after the celebrations of regulatory approval. Meanwhile, compliance expectations under MiCA include ongoing staffing and governance preparedness.
Previously, KuCoin’s worldwide entities came under penalties associated with AML control weaknesses. In January 2025, the firm settled with the U.S. for $297 million. On top of that, the Canadian authorities imposed a C$19.6 million fine for failing to comply.
MiCA Enforcement Sends Warning to Crypto Exchanges
Therefore, the action highlights strict consequences for the government and compliance gaps. In addition, licensed crypto firms are still vulnerable to sudden commercial restrictions. Meanwhile, under MiCA frameworks, regulators across Europe continue to grow increasingly stringent in their oversight.
Consequently, exchanges are reviewing internal controls, staffing and risk management systems. Furthermore, compliance officers are at the heart of regulatory trust and stability. However, abrupt departures or vacancies may trigger supervisory intervention measures in a short period of time.
KuCoin EU said that it will strive to bring back full regulatory compliance. Additionally, the company is to appoint qualified officers without useless delay. Therefore, the temporary prohibition could be lifted upon the condition of satisfaction of requirements.
Meanwhile, customers are watching service continuity and safety assurance of assets carefully. Furthermore, the case is seen by industry participants as a critical MiCA stress test. Consequently, regulators may rush inspections of other licensed crypto platforms that are licensed.
Austria Decision Points to Tighter MiCA Supervision Across Europe
Importantly, MiCA rules mandate that firms should have effective governance and risk control frameworks. In addition, authorities emphasize that licensing approval does not mean permanent authorization. Therefore, continuous compliance continues to be a necessary prerequisite for the stability of operations in the European markets.
However, the KuCoin EU case also raises the issue of scaling compliance teams. Additionally, crypto companies are dealing with increased regulatory requirements in multiple jurisdictions at the same time.
For that reason, governance resilience becomes a decisive factor for licensed crypto exchanges. Furthermore, regulators emphasize accountability of the senior management and control function holders.
Meanwhile, the market participants anticipate that KuCoin EU will address deficiencies and pick up expansion plans. However, the episode serves to reinforce the fact that failures to comply with regulations have swift and tangible consequences.
Ultimately, Austria’s decision indicates that there will be increased supervision by the MiCA era for all licensed crypto asset providers.
