South Korea’s small and medium-sized stock exchanges had the opportunity to raise some of their complaints with the government during a recent meeting with the country’s financial regulators.
According to a report from South Korean media D. Street, the Financial Services Commission (FSC) convened a closed meeting with 20 cryptocurrency exchanges on Thursday.
Internal sources cited by D Street claim that The closed session was a meeting between the Financial Intelligence Unit (FIU) of the FSC and the 20 cryptocurrency exchanges where the FIU expressed the government’s desire to apply its Virtual Asset Service Provider (VASP) registry.
In fact, the FSC. on May 28th problematic a statement declaring her intention to step up her oversight of the cryptocurrency market to combat illegal activity. As part of the plan, exchanges and other VASPs have a six month grace period to register with the government.
This registration process includes, among other things, obtaining certifications of the information security management system and opening trading accounts with real names. The 20 exchanges that attended Thursday’s meeting are the only ones of the 60 VASPs currently operating in South Korea.
But only the “big four” (Bithumb, Upbit, Korbit and Coinone) have managed to open business accounts with real names. At the meeting, the other 16 exchanges, along with other operational difficulties, expressed their difficulty in meeting these real name trading requirements.
Apparently, FSC officials sympathized with the troubles of smaller exchanges and pledged not to interfere in their dealings with South Korean banks. South Korean stock exchanges require banking associations to meet real name trading requirements.
However, the cost of maintaining such banking partnerships appears to be beyond the capabilities of many smaller platforms. As Cointelegraph told you, Upbit’s commission payment to K Bank was ten times higher in the first quarter of 2021 than in the previous quarter.
The South Korean government has now clarified the roles and responsibilities of regulators regarding the regulation of cryptocurrencies in the country.
The regulatory landscape for cryptocurrencies in South Korea has tightened recently, with anti-money laundering and capital gains tax policies being part of a host of new laws.