South Korea’s top financial regulator, the Financial Services Commission (FSC), has launched a “comprehensive inspection” of the country’s cryptocurrency exchanges.
According to Decenter, the Financial Services Commission (FSC) wants to specifically investigate 20 trading platforms that do not have a license to trade the fiat currency KRW. The press noted that it was the “first time” the FSC had conducted a “comprehensive inspection” of an exchange not operating in the fiat currency market.
The outlet said it hoped the inspection would focus on anti-money laundering protocols.
Under Korean law, exchanges can offer trading services between cryptocurrencies if they meet certain criteria. However, to obtain a fiat currency trading license, you must partner with a commercial bank.
These banks are required to provide all exchange users with real name and social security number verified accounts linked to cryptocurrency wallets.
The “Big 4” cryptocurrency exchanges Upbit, Bithumb, Korbit and Coinone have had such banking partnerships for several years. Meanwhile, the remaining 21 South Korean exchanges are left to pursue banking deals with domestic banks. So far, only one of his, Gopax, has been successful.
Which Korean exchanges will be investigated?
FSC said it would launch an investigation from GDAC. He is one of the exchanges involved in the controversial delisting of the Wemix token last year. This is a coin created by domestic gaming giant WeMade.
Observers were stunned when GDAC announced that Wemix would go public. This comes just two hours after the “Big 4” announced they would be removing the coin from their platform.
The news outlet said some insiders believed the FSC had decided to launch an investigation at the GDAC for this reason.
However, some believe the authorities “may have launched” an investigation with the exchange ahead of a possible GDAC application to rejoin the South Korean won market. It suggests that a transaction with a bank may have taken place.
Media outlets reported that GDAC officials said they had not yet been informed of the date of the FSC visit.