South Korea’s regulator to force overseas cryptocurrency exchanges to abide by its rules

cryptoshitcompra.com/wp-content/uploads/2021/07/El-regulador-de-Korea-del-Sur-obligara-a-los-intercambios.jpg »alt =» South Korean regulator will force exchanges of cryptocurrencies abroad to comply with its 101 rules »class =» content-img »/> Source: Adobe / Maksym Povozniuk

South Korea’s top financial regulator has effectively blocked overseas cryptocurrency exchanges from operating domestically if it can be shown that they are actively targeting South Korean land users.

According to Chosun Y Seoul Kyungjae, the Governor Financial Services Fee (FSC), who has been given almost total control over police exchanges, has sent letters to 27 cryptocurrency exchanges that he believes have actively targeted South Koreans. , informing them that they could be subject to penalties if they don’t stop pursuing business. Koreans.

move appears to be a direct response to a challenge posed to regulators on exchanges like Binance at a parliamentary committee hearing earlier this month.

Platforms such as Binance enjoy tremendous popularity in South Korea, and the regulator has suggested that investigations into companies that do not comply with the regulations could be launched, while access to websites could be blocked. And experts have said that this will be the key weapon that regulators will use in their fight against rampant cryptocurrency activity.

Janet Cho, a Seoul-based IT reporter, told Cryptonews.com:

“Government-mandated IP blocks have proven to be very effective in limiting access to sites identified as linked to gambling and pornography. [both of which are technically illegal in South Korea]. Sure, some will try to fix this problem with VPNs, but not many Koreans use VPNs, especially older and less tech-savvy people who have recently entered the crypto world.

Exceptions will be made for companies that complete a registration process with the Financial Information Unit (FIU), the FSC agency that will conduct active surveillance of trading platforms after September 24. However, with a few months to go and a host of hurdles to overcome for any exchange wanting to sign up, the likelihood of any major overseas exchange without a South Korean branch, even just applying, seems, at best. of the cases, scarce.

Chief among concerns will be that exchanges must partner with national banks to ensure real-name transactions, free of anonymity, and that their business carals are rigorously audited and evaluated by partner banks and regulators. Not a single South Korean stock exchange has completed this process, not even the strongly supported and highly profitable national ‘big four’ exchanges: bithumb , Upbit , Coinone, and Korbit . Banks say that even these platforms may have a hard time crossing the line on time.

Cho agreed that it was “highly unlikely” that any of the 27 exchanges contacted by the FSC would apply for a permit, and even less plausible that any exchange would be able to find a banking partner in time. She explained:

“I can’t speak for any exchanges, but if I were them, I would stop actively targeting South Korean clients instead of trying to rush a deal with a typically risk-averse domestic bank.”

Violators have been told they will face jail terms of up to five years and fines of nearly $ 44,000 if they do not stop targeting South Korean-based customers.

FSC added that regulatory clearance has yet to be obtained for the currencies to continue targeting South Koreans. He also advised South Koreans with funds on foreign cryptocurrency exchanges to withdraw their fiat currencies and tokens before September 24 or risk future losses.

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To find out more: – Korean regulators want to oversee all of KRW’s international cryptocurrency exchanges – South Korean cryptocurrency exchanges are ready for legal fight amid shutdown threats

– Crypto Exchange Korbit Charged for ‘Excessive Collection of Customer Data’ – Korean Banking Regulator: Stop Complaining About Crypto Market Risk

South Korea’s 60 cryptocurrency exchanges will be inspected by government and police – Regulator extends AML window of South Korean crypto exchanges by 6 months

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