Kevin Helms
A student of Austrian economics, Kevin found Bitcoin in 2011 and has been an evangelist ever since. His interests lie in Bitcoin security, open source systems, network effects and the intersection of economics and cryptography.
Korean Regulator Takes Action Against 16 Foreign Crypto Exchanges – Regulating Bitcoin News
South Korea’s Financial Intelligence Unit is taking action against 16 foreign cryptocurrency exchanges for operating illegally in the country. “For illegal business activities of unregistered entities, a maximum of 5 years in prison or up to KRW 50 million in fines may be imposed,” the regulator said.
16 foreign crypto exchanges flagged by South Korean regulator
South Korea’s top financial regulator, the Financial Services Commission (FSC), announced Thursday that the country’s Financial Intelligence Unit (KoFIU) has alerted investigative authorities to the illegal business activities of 16 unregistered virtual asset service providers (VASPs).
KoFIU is South Korea’s Financial Intelligence Unit (FIU) and the Asian country’s lead anti-money laundering and counter-financing of terrorism (AML/CFT) agency.
The 16 entities are Kucoin, MEXC, Phemex, XT.com, Bitrue, ZB.com, Bitglobal, Coinw, Coinex, AAX, Zoomex, Poloniex, BTCEX, BTCC, Digifinex and Pionex.
All 16 crypto exchanges are based outside Korea with no formal domestic presence, the regulator said, adding that they were found to be engaging in crypto business activities aimed at domestic consumers. For example, they offer Korean-language websites, host promotional events aimed at Korean consumers, and offer a payment option that supports the purchase of crypto-assets using credit cards in the country.
KoFIU notified foreign-based crypto exchanges on 22 July last year that they must register their business with the authority. However, the 16 aforementioned entities continued to operate in South Korea without obtaining registration.
The authority said in detail:
For illegal business activities of unregistered entities, a maximum of 5 years imprisonment or up to KRW 50 million [$38,000] of fines can be imposed with a restriction to register as a VASP in the domestic market for a certain period of time.
The regulator explained that the financial authorities in the jurisdictions hosting the service providers will be informed and related credit card processing will be stopped in the domestic market. In addition, “Transfers of virtual assets to and from the 16 unregistered entities will be rendered impossible as the authorities have issued an administrative guidance requiring the suspension of transactions between the registered and unregistered entities,” KoFIU described.
The regulator stressed that “the authorities plan to take necessary measures” to stop crypto service providers from operating without registration in South Korea:
KoFIU will continue to closely monitor illegal business activities carried out by unregistered entities and maintain close cooperation with relevant authorities.
What do you think about the South Korean regulator cracking down on crypto exchanges operating illegally in the country? Let us know in the comments section below.
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