The Big Shift in Crypto Regulations
On March 5, South Korea’s National Assembly made waves by passing a revised bill aimed at overhauling the way cryptocurrency exchanges operate. It’s like a new level in a video game where players must now obtain licenses before trading—except, in this case, the stakes are real lives and real money.
Time to Get Real
This newly minted legislation introduces a permit system for cryptocurrency exchanges that require them to report their transactions to the Financial Intelligence Unit (FIU). But wait, there’s a twist! To play the game, exchanges will need to secure “real name-confirmed accounts” with commercial banks. They better not try to create accounts under superhero aliases, as it could lead to some serious penalties. A wild card might land them up to five years in the clink or a hefty fine of 50 million won (about $42,000)!
Reporting Game On
Mark your calendars and set your reminders! Existing crypto exchanges have six months post-law implementation, which is expected in March next year, to get their act together. This means integrating real-name accounts and meeting ISMS authentication standards—because what’s the point of a virtual asset if you can’t assure it’s coming from a legitimate source?
Strengthening the Anti-Money Laundering (AML) Framework
In a step designed to promote trust (and battle the shady dealers), the Financial Supervisory Service and FIU plan to ramp up their Anti-Money Laundering systems according to recommendations from the Financial Action Task Force. This is now the moment to play nice, as the pressure mounts on exchanges to demonstrate legitimacy in a field long plagued by dubious practices.
A Battle for Survival
With big players like Upbit, Coinwon, Bithumb, and Korbit already in the ring with real-name accounts, smaller exchanges, which often operate on honeycomb accounts—think of them as the uninvited guests at a party—are on the chopping block. If they can’t step up their game and get real with their accounts, they might find the exit sign lighting up. It’s clear: Only the strongest will survive in this new regulatory landscape!
