South Korea’s financial authority is shutting down various local cryptocurrency exchanges, the Korea Herald reported on Sunday. The country’s financial regulator, Financial Services Commission (FSC), has shut down 11 local cryptocurrency exchanges due to their engagement in illegal activities.
Moreover, Darlbit and Bitsonic are among South Korean crypto trading platforms that recently declared stop business operations. However, the entire list of exchanges that are set to shut down remains unclear. In addition, Bithumb and Upbit, the two biggest crypto exchanges in the country, have been spared by the crackdown. It seems that this is because both are well-known among other crypto trading platforms that offer real-name trading accounts for their customers.
Besides, real-name registration has been compulsory in South Korea since 2018. To clarify, this is a push to root out money laundering and other fraudulent activities.
According to the report, banks were hesitant to extend partnerships with local cryptocurrency exchanges due to the low risk-reward ratio of such deals. However, the leading players of the likes of Bithumb have had their businesses continued until September.
Consequently, various smaller trading platforms saw themselves backed into a corner.
On another note, international cryptocurrency exchanges need also to register with the Korea Financial Intelligence Unit (KFIU) by Sept. 24. Otherwise, they will have to close their shop or possibly face criminal charges.
