[Photo by Lee Seung-hwan]
From Sept. 24, only four cryptocurrency exchanges in South Korea can host Korean won-based trade while 24 others can only host digital coins, whereas 38 would no longer exist, according to the government.
As of Sept. 10, there were 38 digital coin exchanges that have yet to receive Information Security Management System (ISMS) certification. A virtual currency business operator is required to have the certification to register their business to the Financial Intelligence Unit (FIU) under the FSC by Sept. 24.
The 38 crypto exchanges without ISMS certification will cease to exist because it takes time to receive the certification, said an official from the government.
Coin exchanges that have received the ISMS certification but failed to find a commercial bank to provide real-name accounts must suspend their real money transactions. Their operations are allowed only for digital coin transactions after Sept. 24. So far, only the four major crypto exchanges – Upbit, Bithumb, Coinone and Korbit – are backed by commercial lenders to provide real-name accounts. Banks are reluctant to sign the deal with small crypto exchanges due to concerns about possible illegal money laundering.
Exchanges must inform their business status to their customers and set aside investors’ deposits. If one decides to close down, it must post the information at least seven days before closure and notify procedures for customers to withdraw their money. Investors have additional 30 days to pull out their money after business shutdown.
Investors are advised to pull their money out before the business closure next week. If an exchange refuses to return investors’ deposits and assets after closing their business, they should report the case to the FIU, FSC or police.
By Lee Sae-ha and Choi Mira
[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]