Upbit to mandate users to verify identity for crypto trade from next month

Upbit, South Korea¡¯s largest and first cryptocurrency exchange to be officially registered, is mandating users to verify their identity starting next month to meet the new and stricter anti-money laundering regulations.

According to local financial authorities and industry sources, Upbit will begin user verification starting next month upon receiving the registration certification from the Financial Intelligence Unit (FIU) under the Financial Services Commission (FSC).

Upbit received the FIU¡¯s approval on Sept. 17, becoming the country¡¯s first cryptocurrency exchange officially registered with the financial authorities, but the FIU has been delaying issuing the official certification to allow the crypto exchange to get ready to meet stricter anti-money laundering requirements.

Upbit announced that once the user verification begins on Oct.1, users will not be able to process transactions worth more than 1 million won ($844.38) unless they go through the know-your-customer (KYC) process, under which they will be requested to provide a photo of their ID card on the Upbit app. For transactions worth less than one million won, verification will start from Oct.8 to prevent traffic overload, Upbit explained.

To minimize user inconvenience, the crypto exchange has decided to grant a week-long grace period for outstanding orders that have not been executed prior to Oct.1. If such orders have not been signed by Oct.7, they will be cancelled the next day.

Won-denominated deposit balance in unverified accounts, which amounts to 100 billion won, will be entirely returned to users under the real-name trading obligation, Upbit said.

Other three major crypto exchanges—Bithumb, Coinone and Korbit—that have filed for registration with the FIU after securing real name account deals with banks are expected to undergo similar customer verification process once they get a green light from the financial authorities.

[¨Ï Maeil Business Newspaper & mk.co.kr, All rights reserved]