As the South Korean regulatory authorities tighten their grip on the country’s cryptocurrency industry, many exchanges have stopped trading with high-risk minor tokens.
Arirang, a local media outlet, reported Wednesday that eleven of twenty local cryptocurrency exchanges had received Security Management System certificates. These certificates allowed them to either stop trading with several tokens or issue a warning list warning traders to be careful.
According to the report, five coins were delisted by Upbit, a leading Korean exchange: Paycoin (Maro), Observer, Solve.Care and Quiztok. Huobi Korea abruptly stopped trading services using its own exchange token, Huobi token. Coinbit suspended trading with eight cryptocurrency and issued a warning against 28 digital currencies.
FBS received the Best Forex Broker Thailand 2021 award
All exchanges have a tendency to suspend trading of cryptocurrencies with low market capitalization. The latest delisting by South Korean exchanges of a variety of tokens shows their eagerness for regulators to approve them.
What is the burden on small players?
The sole regulator of South Korea’s cryptocurrency exchanges is the South Korean Financial Services Commission (FSC). The government required all new exchanges to register with the regulator and keep real-name bank accounts for all clients. Existing exchanges must also comply with the revised framework by December’s deadline, which was recently extended.
The regulator is also seeking information from banks to find out if any non-compliant exchanges are operating on the local market. The FSC also ordered banks to take cryptocurrency traders into account and mandated ID verification.
Only four of the major South Korean crypto exchanges have real-name accounts. The smaller ones are having trouble finding banking partners.