FSC warns of stern oversight on crypto exchanges ahead of registration deadline

[Source: Financial Services Commission]

South Korea’s financial authority vowed strengthened watch over cryptocurrency trade as the country falls under a new set of rules from this week.

Koh Seung-beom, chairman of the Financial Services Commission (FSC), held a meeting with other regulators on Wednesday upon the imminent arrival of the Sept. 24 deadline mandating real-name account and other stronger certification requirement for crypto exchange operators.

“Since there is no clear rule to ensure an order in virtual assets, transparency in the trade is essential,” said Koh ordering “stern” surveillance and supervision on exchanges.

A majority of cryptocurrency exchanges in South Korea have already notified their users of suspending Korean won-denominated coin trading under the new rule.

According to the Financial Intelligence Unit (FIU) under FSC, only one cryptocurrency exchange, Upbit, passed the registration test. Registration by Bithumb, Coinone, Korbit, Flybit, and Korea Digital Asset is pending. A total of 31 companies are still readying registration.

FIU registration require crypto exchanges to get a bank’s verification on digital coin trade account users’ real name and Information Security Management System (ISMS) certification. The registration deadline is Sept. 24.

FIU has recommended that digital asset trade firms unable to meet the registration requirements make public notice of shutting down their operations for Korean won-based digital coin trade service or business closure by Sept. 17.

So far, 24 digital asset firms that hold ISMS certificate but had not obtained bank partners to support real-name accounts verification notified their users that they are halting digital coin trade service in Korean currency. Another 14 firms also have either announced their service closure or already shut down trading operation after failing to get ISMS certification in time.

One crypto exchange is still in operation without posting closure notice even after it has not registered with the FIU. The firm has been reported to the police.

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