South Korea’s cryptocurrency exchanges continue to transform under the weight of mounting regulatory pressures. Major crypto exchanges such as Upbit have this week moved to delist or warn against specific digital assets they have judged to be high-risk for investors. According to the Korea Herald report, the trend has seemingly been sparked by increasing intervention by financial regulators into crypto service providers’ operations.
Crypto exchanges are under pressure to comply with new regulations.
Earlier, Korea’s Financial Intelligence Unit (FIU) reportedly contacted 33 crypto trading platforms to warn that it would be conducting a field consultation before Sept. 24. These consultations aim to check whether or not the businesses are compliant with requirements set by the Specific Financial Transactions Act, which came into force in March of this year. One of Korea’s leading crypto exchanges, Ubit, delisted Maro, Paycoin, Observer, Solve.Care and Quiztok last week and issued warnings on its English site for six assets, triggering a one-week review process by the end of which a final decision as to whether or not to delist these six will be taken.
Several other exchanges make similar decisions.
In addition to Upbit, a reported total of 11 out of 20 exchanges that received a Security Management System certificate have taken similar moves, and Korea’s Financial Supervisory Service has also this week contacted multiple exchanges requesting that they provide the agency with the details of delisted or suspended assets. In addition to agencies’ direct communications with exchanges, Korea’s Financial Services Commission (FSC), tasked with oversight of the cryptocurrency market, has reportedly formed five new working groups that will be each charged with specific tasks tied to implementing Korea’s new crypto regulatory regime.