By midnight tonight in South Korea, several crypto exchanges will cease to exist due to new regulations imposed by the government. Currently, about thirty-five exchanges are at risk of being forced to shut down because they fall short of regulatory requirements. This leaves a total of four main exchanges in the country in addition to about twenty-four smaller ones.
The Financial Services Commission (FSC) set the two major requirements for exchanges which go into effect on Saturday. First, all exchanges must receive an Information Security Management System (ISMS) that demonstrates protecting users’ personal information. Secondly, exchanges must partner with a South Korean local bank to fulfill specific obligations. The FSC mandates this to negate the risk of financial impropriety, such as money laundering, embezzlement, and price manipulation.
The four main exchanges cleared of these requirements are Upbit, Bithumb, CoinOne, and Korbit. The aforementioned exchanges fully achieved the requirements and submitted the compliance report to the Financial Intelligence Unit (FIU). The thirty-five exchanges unable to fulfill these requirements will be wiped out in less than a day. Twenty-four others are halfway through the requirements and can only now provide limited services as a result. They can not deal in cash-to-crypto transactions and can only render token-to-token services.
Image Credits: Pixabay
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