The deadline to register cryptocurrency exchanges for those targeting South Koreans is fast approaching. The country’s financial watchdog has been very strict on all trading platforms and will only hand out licenses if they meet certain requirements.
In recent months following increased global speculation about regulations from various governments around this new type of currency, many countries have taken steps towards regulating them – some with stricter measures like China banning them altogether. Others are taking a lighter approach with merely requiring registration before being able to conduct trade or restrict anonymity by mandating that users’ identities be disclosed when making transactions over specific amounts.
Overseas crypto exchanges are not as bothered by the sanctions imposed on North Korea. The Korean Herald reported that these firms must register with a South Korean anti-money laundering authority to comply with stricter measures in order to avoid being sanctioned themselves, but it appears they aren’t too concerned about this new legislation since their businesses will still be booming even after sanctions start hitting them.
The recent news of the crypto company, Bitfront from South Korea is affecting their service in nearby regions. This not only includes a ban on Korean-issued credit card transactions but also an earlier exit date for residents near the US border.
The firm has announced that it will stop providing services to locals starting September 14th, 2021, and clarified this decision with “expectations” coming up in regards to regulations within two years’ time span.
The crypto craze is not just over in Korea, but also at home. The domestic scene has been scrutinized as well by the authorities and some exchanges failed to pass regulatory consulting audits ahead of a deadline set for this month.
The local market was examined back in July when it emerged that several firms were allegedly conducting fraudulent banking operations which led investigators to monitor them more closely now with only days before their final deadline arrives.
No Proper Anti-Fraud Systems
The Financial Services Commission (FSC) is now requiring banks to issue accounts with customers’ real names to prevent money laundering.
The FSC, which regulates the banking industry and enforces financial laws, has started enforcing this new rule for crypto exchanges that were previously not regulated by them. This will ensure transparency on how funds are being used and also keep track of suspicious activities like fraud or drug trafficking more effectively than before.
The South Korean government has spent the past few weeks trying to figure out how they can prevent cryptocurrencies from being used for fraudulent purposes. They found that these exchanges did not have proper standards and protocols in place, which leaves them open to manipulation by outside forces such as governments or hackers with malicious intent.
The recent audit report for the Korean Exchange system uncovered that some of its exchanges failed to comply with all aspects, including standards on listing and delisting tokens. The lack of anti-fraud systems prevents manipulation in token prices which is a highly sought-after concern by South Korea’s authorities as they work towards tackling this issue down.
Recently, South Korean commercial banks are looking to see cryptocurrency exchanges with ‘too many’ coins in offers and will deplete their chances of getting real-name account services.
The Korea Federation of Banks was formed by commercial and real-estate lenders in April to provide the latest risk assessment guidelines for cryptocurrency exchanges. The banking body has 22 full members and 36 associate members, making it one of the largest trade organizations in South Korea with over 50% market share.