According to local media outlets, Upbit is the first South Korean cryptocurrency exchange registered with the Financial Intelligence Unit.
All cryptocurrency trading platforms in the country must register with the agency by the deadline on September 24. Failure to register by the deadline will result in an unregistered exchange and possible blockade.
Doh Gyu Gyu-sang, Chair of the Financial Services Commission (FSC), told local media that they expect to see one or two additional exchanges registered by the end this month.
Scarce Banking Partnerships
However, the requirements for registration are often criticized in the smaller South Korean Exchanges. Exchanges must register with FIU and have a bank partner to hold real-name accounts for their clients. This requirement has been met by only four of the major local exchanges.
Upbit’s banking partnership with K-bank for real-name accounts is with Upbit. Three other crypto giants in the area, Bithumb and Coinone, have also signed banking deals and will likely be the next to receive FIU approval.
South Korean banks are still hostile to crypto exchanges and won’t consider them partners. This has also put at risk the existence of smaller, locally-operated exchanges. Many local exchanges have already closed due to strict regulatory requirements.
An anonymous insider said that “[Korean cryptocurrency exchanges] are having difficulty getting real-name accounts at local banks.” “We are likely to see more exchange closures than we have 100.”
South Korean customers are required to adhere to the rules of foreign exchanges that offer services. This led to the closing of the Korean operations of OkEx and Binance. They also stopped offering trading pairs or payment options using the South Korean won.