Crypto exchanges in South Korea to shut operations

  • More than 60 South Korean exchanges to stop operations in the country
  • Exchanges have to register with the authorities by September 24
  • Those exchanges who fail to secure partnerships with banks will be prohibited from trading in won

South Korean traders will now have to look for an alternative if they want to trade in cryptocurrency. As per the new laws, won will be suspended from trading. Hence, more than 60 crypto exchanges in the country will have to notify customers of a partial or full suspension of trading by Friday midnight. This happened a week before a new regulation came into force.

To continue operations, exchanges have to register with the financial intelligence unit by September 24, providing a security certificate for the internet security agency. They must also partner with banks to ensure real-name accounts. 

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Exchanges that have registered must shut down services with the financial intelligence unit by September 24, while those that have registered but fail to secure partnerships with banks will be prohibited from trading in won. 

Customers are priority

The Financial Services Commission said that some or all services that need to be closed by the exchanges should be notified to the customers of the expected closing date and procedures to withdraw money by at least seven days before the closure. The commission has said that it should be completed no later than September 17. 

From all the exchanges, nearly 40 are to suspend all services. A further 28 have security certificates but have not secured bank partnerships. Among all exchanges, only four Upbit, Bithumb, Coinone and Korbit have registered and secured partnerships and so they will be allowed to make won settlements.

Smaller exchanges like ProBit, Cashierest and Flybit have already said they will end won trading, and that they will continue operations involving only digital coin trading until securing partnerships with banks. 

Many investors in the country have invested in won as an alternative to bitcoin or ethereum, which have decreased in value as regulators crackdown on the sector. With the new rules to roll out soon in the country, exchanges will delay hundreds of altcoins as they vie for tie-ups with banks. 

The new law was passed in early March. As per the new law, exchanges would have to acquire a security certificate from a South Korean internet security agency. Only 20 exchanges had received such certificates till May.  

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Andrew Smithhttp://thecoinrepublic.com
Andrew is a blockchain developer who developed his interest in cryptocurrencies while his post-graduation. He is a keen observer of details and shares his passion for writing along with being a developer. His backend knowledge about blockchain helps him give a unique perspective to his writing

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