The South Korean crypto exchange Daybit on Aril 25, has announced to voluntarily shut its operation, because of the strengthening of anti-money laundering law in the country.
Chain Partners, a company that operates Daybit, has stated that the company is planning to stop its services by June 01. A few months ago, CPDAX, a company that was operated by blockchain technology developer Coinplug, has also announced to shut its services in the country.
While explaining its decision of opting out, Chain Partners said, “The operation of Daybit will be halted in phases by June 1 as we are unable to provide normal transaction services amid the toughened regulatory environment after the Act on Reporting and Using Specified Financial Transaction Information went into effect recently.”
As per the report, Daybit has inked a contract with Shinhan Bank, which says that before June the exchange will stop all its operation in the country
There are many other local exchanges in the country that are facing a similar problem, they are unable to meet the requirements under the new law. Some of the industry experts predict that these local exchanges would also shut their operations.
According to the revised Act on Reporting and Using Specified Financial Transaction Information, the crypto exchanges in the country should implement the information security management system. Also, they should form a partnership with local banks by September 24. By that day, all the crypto accounts on the exchanges should be linked with the bank in the holders’ real name.
It has been reported that four of the big crypto exchanges in the country .i.e., Upbit, Bithumb, Coinone and Korbit have already liked the accounts, on their platform, to the local lenders. However, many of the small exchanges are still struggling, as the banks do not want to take the responsibility of screening the exchanges.
The banks also have some issues with the newly amended regulation, as they feel there is a need for government guidelines which has not been fulfilled yet.