South Korea Tightens Cryptocurrency Regs

South Korea tightens Cryptocurrency regs. Seoul is strengthening regulations because it is concerned about the possibility of financial crimes. Critics claim that it has the potential to drive cryptocurrencies off the market entirely.

South Korea passed new legislation in March that will increase the oversight of virtual assets in the country. But the proposed rule has been met with opposition from banks,. Who are concerned that many of the altcoins and cryptocurrency exchanges that have sprung up. In South Korea would be forced to close their doors.

For South Korean businesses to be permitted to operate, all virtual asset asset management providers. Which includes cryptocurrency exchanges and other virtual asset service providers. Must first register with the Korea Financial Intelligence Unit (KFIU). The Korea Financial Intelligence Unit (KFIU) is the anti-money laundering arm of the Financial Services Commission (FSC). And exchanges would be required to report suspicious financial activity to the KFIU.

Exchanges must be certified by the Information Security Management System in order to register. And they must confirm that their clients have genuine name back accounts. As well as that its CEO and board members have not convicted of a crime. In addition, the law compels exchanges to produce evidence of acceptable levels of deposit insurance to cover losses resulting from hacking.

To make it easier for cryptocurrency investors to deposit money into their virtual wallets. South Korea began implementing a requirement that the name on their bank account match the identity. On their account at a cryptocurrency exchange starting in January. Given the new requirements for exchanges to ensure that its consumers have real name bank accounts. They also obligated to collaborate with domestic banks in order. To establish real name bank accounts for their customers.

Banks in South Korea are wary of bitcoin exchanges

Because of negative statements made by regulators about virtual assets and the possibility of financial crimes. On cryptocurrency exchanges, South Korean banks, on the other hand. Have been hesitant to engage with cryptocurrency exchanges. Instead, as the government tightens regulations, banks are attempting to restrict their exposure for cryptocurrency. They have requested that the authorities absolve them of any responsibility for money laundering. Or other financial offences committed on bitcoin exchanges..

Because of the reluctance of banks to collaborate with cryptocurrency exchanges. All but a few South Korean cryptocurrency exchanges may compelled to close their doors. Exchanges must partner with a South Korea tightens Cryptocurrency in order to continue operating. But because South Korean banks are unwilling to take on the risk associated with dealing. With cryptocurrency exchanges, they will be unable to register with the government. Or withdraw money for cryptocurrency trading after September 24.

According to the new law, banking standards must be in accordance with suggestions. Made by the Financial Action Task Force on Virtual Assets in regards to know your own customer regulations. These regulations intended to prevent money laundering and other financial crimes from taking place. Many people, however, are considering suing the government and the Financial Services Commission (FSC). Because of the possibility of a number of exchanges closing.

The deadline is also motivating bitcoin exchanges. South Korean exchanges have started delisting or warning hazardous virtual assets. This led to legal action. Several lawsuits have filed against Upbit for delisting 24 cryptocurrencies.

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