Friday, May 20, 2022

Top Financial Regulator Asks Overseas Crypto Exchanges Using Won-Currency To Register With AML Body

If the foreign crypto exchanges are offering their services to an individual in South Korea with the won-currency settlement, then the platform must register itself with the anti-money laundering body of the country, announces the top financial regulator.

Eun Sung-soo, the chairman of the financial services commission, recently held a discussion with the lawmakers of the country, where he was asked whether Binance should comply with South Korea’s law from September. 

Eun, in his reply, told the lawmakers, “If a cryptocurrency exchange serves local customers with the won-currency settlement, it must register with the (Korea) Financial Intelligence Unit.”

In March 2021, the country issued a revised law, which requires the banks to issue real-name accounts under stricter guidelines, within six months. The law further suggested that this way the banks would be able to prevent money laundering on their platform.

The revised law allows the banks to evaluate the transparency of crypto exchanges, business risk and the possibility of criminal activity. 

According to the reports, there are around 100 minor crypto exchanges in the country which use opaque accounts to lure investors. 

The exchanges using opaque accounts can manage their customers’ accounts with their own bank accounts. 

It has been notified that from September 25, the minor crypto exchanges in South Korea would not be able to withdraw money for trading, if they do not reveal the real-name bank accounts.

During this time of the pandemic, the South Korean sees cryptocurrencies as lucrative assets, therefore, despite getting warnings from the policymakers, the Korean investors are still buying them. 

The report states that most citizens of South Korea, investing in cryptos, are youngsters. They believe that the digital assets would offer them high returns with which they could afford their own house.

Apart from that, the government is also planning to impose a 20 percent tax on capital gains from crypto transactions next year, however, many of the investors have urged the authorities to delay their plan.

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