Foreign cryptocurrency exchanges servicing digital coin trade in the Korean won are obligated to register business with South Korea’s financial regulators by Sept. 24 or face penalties and suspension in business with Korean nationals.
The Financial Intelligence Unit (FIU) under the Financial Services Commission announced on Thursday that it had sent out notices to 27 offshore crypto exchange operators mandating them to register with the FIU and obtain separate business authorization by Sept. 24 under the nation’s new regulation if they want to continue to serve Korean investors.
Binance, the world’s largest cryptocurrency exchange in terms of trading volume, is among those subject to the rule.
Any exchanges incompliant with the regulations will be banned from servicing Korean investors starting September 25 and could face a jail sentence of maximum five years or a fine of up to 50 million won ($43,527) if they continue trade with Korean nationals without authorization, the FIU said in a press release. It will also block locals’ access to their websites to prevent illegal operations.
The new regulation, which took effect in March with a six-month grace period, requires all virtual asset service providers to register with the FIU to keep operations. To qualify for registration, crypto exchanges must ready with verifiable bank accounts in real names and Information Security Management System certification.
So far, none of foreign exchanges has obtained such certification, FIU officials said.
The financial regulator recommends traders with foreign crypto exchanges withdraw their funds to prevent possible losses.
By Yoon Won-sup and Lee Soo-min
[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]