South Korea’s financial watchdog set an official deadline for local banks and cryptocurrency exchanges to halt anonymous cryptocurrency trading and switch to real-name accounts. The new rules are part of the FSC’s efforts to curb cryptocurrency speculation and prevent cryptocurrency-related money laundering.
In a press release, issued today, the Financial Services Commission (FSC) said that starting from January 30, banks will switch to a new policy that would allow only a user’s real name to be used in cryptocurrency trading.
Are you looking for fast-news, hot-tips and market analysis? Sign-up for the Invezz newsletter, today.
“Under the new rule, users who want to make cryptocurrency transactions must have accounts under their real names at the same banks where cryptocurrency exchanges open their accounts,” the FSC said. Users, who do not comply with the new policy would not be allowed to deposit funds to trade cryptocurrencies, the watchdog added.
The regulator also provided further guidelines for crypto exchanges, outlining situations that could be indicative of illegal activity.
“For example, if a user makes deposits or withdrawals worth more than KRW10 million per day or KRW20 million per week, it falls into a type of suspicious transactions that can be deemed as money laundering,” the watchdog said. “If banks have reasonable evidence of such a suspicious transaction, they will be asked to report to [the Korea Financial Intelligence Unit].”
The measures will have a significant impact on non-Korean cryptocurrency traders. According to the statement, “[m]inors under the age of 18 and foreigners will not be allowed” to open accounts to trade on local cryptocurrency exchanges.
Yesterday, one of South Korea’s major exchanges, Korbit, announced that it intended to halt its virtual account service by the end of the month and foreign nationals would no longer be able to deposit fund to their accounts after the shutdown.