South Korea to require crypto exchanges to share user data with lenders

Written by: Michael Harris
March 11, 2020

The South Korean government plans to make cryptocurrency exchanges share users’ transaction data with banks, local news agency Yonhap has reported.

The Sunday report, which cited an unnamed government official, suggested that the plan will most likely come into effect later this month or in early February, when local lenders are expected to introduce a system that ensures only real-name bank accounts and matching accounts at cryptocurrency exchanges are used for deposits and withdrawals. The same system will also facilitate the user data exchange between cryptocurrency trading platforms and banks.

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According to the source, lenders will be obliged to check whether crypto exchanges comply with the requirement. The official also said that “in a measure of tax enforcement for cryptocurrency traders”, the government would be able to access the users’ transaction data provided to the lenders.

In a separate report, published today, Yonhap said that the government had announced that it would collect up to 24.2% of income taxes from cryptocurrency exchanges this year.

South Korean authorities have been stepping up its efforts to monitor and regulate domestic cryptocurrency trading in an attempt to curb the investment craze for virtual currency in the country. This month there have been multiple comments from high-ranking government officials that the government is considering a number of measures, including a possible ban on cryptocurrency exchange operators. That measure, in particular, has caused a public outcry, with cryptocurrency aficionados launching an online petition against “unjustifiable regulations” in the sector. The petition recently surpassed 200,000 e-signatures, which warrants an official response by the government.