Get ready for some crypto drama in South Korea! The number of crypto exchanges in the country is about to take a nosedive, thanks to a major crackdown by the Financial Intelligence Unit (FIU). These financial watchdogs are tightening the reins on several overseas platforms that haven’t been playing by the local rules.
Picture this: you’re a crypto exchange like BitMEX, KuCoin, CoinW, Bitunix, or KCEX, trying to make your mark in South Korea. But, there’s a catch! You’ve got to report as a Virtual Asset Service Provider (VASP) under the Specific Financial Information Act. If you don’t, you could be in hot water, facing criminal charges and administrative penalties. Yikes!
The FIU is not messing around. They’ve got their eyes on these exchanges that are operating illegally by offering Korean-language services without proper marketing and support for local investors. What’s their game plan? Potentially blocking access to these sites and throwing in some sanctions for good measure.
An FIU official spilled the beans, saying they're teaming up with the Korea Communications Standards Commission to possibly pull the plug on these unreported exchanges. They’re gathering evidence and sharpening their tools to ensure that investors are kept safe and compliant exchanges thrive.
This isn’t the first time South Korea’s financial authorities have played hardball. Back in September 2021, they told over 60 exchanges to pack up and leave if they couldn’t meet the anti-money laundering (AML) rules. Only a handful, like Upbit, Bithumb, Coinone, and Korbit, made the cut.
Fast forward to 2022, and the FIU was still on a mission, blocking access to 16 overseas exchanges and teaming up with local card companies to prevent crypto purchases through these platforms.
As of now, there are just 31 registered crypto firms left in South Korea, a significant drop from 42 just a few years ago. With this latest crackdown, it looks like that number might dwindle even further. So, buckle up, South Korea’s crypto scene is in for a wild ride!
