South Korea Demands Crypto Exchange Data from Banks for Tighter Regulations
The financial regulators in South Korea are seeking crypto exchange data from the banks in order to identify all the exchanges working in the country.
A report by the Korean Herald revealed that many financial regulators in the country are asking major banks to provide data about the crypto exchange businesses they are dealing with. They are even asking for the details linked with the corporate accounts and the details regarding the method used by banks for monitoring.
The step is taken due to the country’s recent regime of regulating the crypto industry. Since the crypto industry is rapidly booming, the country passed some strict regulations to curb illicit activities in the sector. The new regulatory measures require all crypto exchanges in South Korea to maintain the record of all their clients and maintain real bank accounts under the name of the real client.
The big four crypto businesses in the country, Upbit, Bithumb, Coinone and Korbit have managed to take the support of the banks while minor businesses are still struggling to partner with an appropriate bank.
“Currently, cryptocurrency exchanges can operate without permission from the government, which is why it is difficult to identify the exact number of cryptocurrency exchanges,” an official told the local media. “One way to find out is to track corporate bank accounts that collect customers’ funds.”
According to South Korean officials, approximately 100-200 small crypto exchanges are working in the jurisdiction without being properly authorised. The financial watchdogs plan on enforcing sanctions on all these exchanges after they have gathered all the data from the bank as the deadline for them to register with a bank approaches.
Additionally, the crypto exchanges are also required to provide the regulators with a regular report regarding their operational details. Failure to comply will result in a jail time of up to 5 years or a fine of more around $44,000.
These measures have moved many South Korean crypto firms to shut their businesses as these measures are too difficult for them to comply with. A crypto exchange firm by Chain Partners, Daybit, has announced that it will be terminating its operations by June. OKEx, a global crypto giant, has also terminated its operations in South Korea. The industry experts have also predicted that soon enough, many other crypto exchanges will also shut down their operations.