South Korean cryptocurrency exchange Coinpia announced yesterday that it was suspending its fiat deposits and its trading operations after failing to comply with new regulations before the expiry a deadline set by the local authorities.
Last month South Korea’s financial regulator ordered cryptocurrency exchanges operating in the country to switch from virtual trading accounts to real-name ones by January 30. The new requirement was part of the government’s strategy to bolster anti-money laundering controls and curb cryptocurrency speculation.
Coinpia suspended Korean won deposits on January 30, in an attempt to comply with the new requirement. However, according to a statement, published on Coinpia’s website, the company continues to face difficulties in integrating identity verification into its existing exchange system and for that reason it has decided to halt its trading operation, as well.
It has been just over a week since the new rule came into effect, but early signs show that South Korean cryptocurrency investors have so far been slow to adapt. According to a recent report from local news agency Yonhap, as of Sunday, just over 8% of the total number of virtual trading accounts had been converted to real-name bank deposits. According to the report, some industry observers have suggested that investors have been reluctant to switch to real-name bank accounts due to the ongoing sell-off that continues to weigh down cryptocurrency prices.
Today, the cryptocurrency market has launched a bit of a recovery after several days of decline. The most popular digital currency, Bitcoin has returned above $8,000 after nearly dropping below $6,000 yesterday. Its largest competitor, Ethereum was trading at $830, as of 15:16 GMT, having gained 14.5% in the last 24 hours.