Cryptocurrency Exchanges in South Korea Are Closing

Cryptocurrency Exchanges in South Korea Are Closing

The day that has been awaited with curiosity and fear for months in South Korea has come. With the introduction of the new digital asset law in the country, exchanges that do not comply with KYC (authentication) and AML (anti-money laundering) rules will begin to close tomorrow. The news from the country is that only 4 crypto exchanges have complied with the new law so far… It is expected that around 70 exchanges will be closed or their operations will be suspended.

As of September 24, which is the last day in South Korea, about 70 exchanges are expected to cease their operations either completely or gradually. As it will be remembered, in April, the country’s financial-regulation agency FSC announced that all exchanges had to comply with the newly introduced anti-money laundering (AML) and identity recognition (KYC) rules that had to be made with banks. The deadline given to the companies was September 24.

40 exchanges did not even register

The news from the country on the subject is not positive at all. According to the information passed by Reuters; So far, only Upbit, Bithumb, Coinone, and Korbit exchanges have fully complied with the new rules and obtained the necessary certificate. It was also stated in the news that 40 exchanges did not even register for auditing and they are likely to cease their operations from tomorrow. On the other hand, the websites of non-registered exchanges will also be closed.

No transaction with “won” for those who register but are insufficient

It has been claimed that 28 exchanges have registered with the KFIU, the FSC’s anti-money laundering arm, for auditing, but these exchanges have not yet made the necessary agreements with the banks. These exchanges will gradually resume their operations, but will not allow transactions in won, the official currency of South Korea.

South Korea is currently one of the countries with the strictest regulatory rules on cryptocurrencies, and it is stated that the new law is not liked by the banks as well as the cryptocurrency exchanges, due to the burden of responsibility taken, and there is a serious discontent in the sector.

The end of small-scale exchanges…

In the summer, it was stated that some cryptocurrency exchanges were also considering suing the state agency, the FSC.

It is considered certain that the new regulatory rules will lead to the closure of small-cap exchanges that generally only allow trading of altcoins in South Korea.

SEE ALSO: What Can Be The Future Of Blockchain Technology?

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Caroline Tetra

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