Major South Korean crypto exchanges, including Upbit, Bithumb, and Korbit, will follow Coinone’s lead in banning transfers to unverified wallets, industry analysts say.
Yesterday Coinone announced that it would decline deposits from unchecked private purses from January 24th to reduce the risk of money laundering. All Korean exchanges, including Upbit, Bithumb, Korbit and 20 others, are expected to implement similar or identical measures to Coinone by March 25. The Korean government to adjust the deadline for exchanges to closely track coin transactions on and from their platforms.
Korean blockchain industry analyst Jun Hyuk Ahn told Cointelegraph, “The Korean exchanges are developing their own travel rule solutions to meet the requirements for operations after March.”
“All Korean stock exchanges must have a travel rule system by March because the government has given them a deadline. Coinone just did it first. “
The rule for the exchange will also help the Far Eastern nation that Financial Action Task Force (FATF) “Travel Rule”.
According to the Anti-Money Laundering (AML) Compliance Service The signal, the travel rule stipulates that national governments “must ensure that domestic exchanges share real identity information with counterparties to the transmission or are exposed to increased surveillance by AML / CFT”.
These exchange compliance requirements are part of a long line of regulatory restrictions for crypto exchanges that comply with the Real name bank account Requirement for all users. Before this rule was introduced in 2018, crypto exchange accounts could be linked to a bank account owned by multiple people.
By September 2021, exchanges were required to have Internet Security Management System (ISMS) verification and a single domestic banking partner who would issue real name accounts. Any exchanges that failed to meet the requirements were forced to remove KRW pairs from Trade or suspend services all in all.
Related: Binance Turkey fined 8 million lira for non-compliance with money laundering
The country has also grappled with global FATF compliance issues related to non-fungible tokens (NFT). Financial regulators changed their policy stance on NFTs until the recent November 24 statement from the Financial Services Commission stated that they did explore its regulatory options and tax NFTs.
Worldwide, South Korea’s stock exchanges are the outliers when it comes to adhering to the rule. There are currently no other major crypto spot exchanges that require users to verify their private wallets.
