Nearly 40 crypto exchanges out of an estimated 60, may wind up operations by September 24 in South Korea, according to a report by Financial Times. South Korean cryptocurrency traders stand to lose more than $2.6 billion due to the shutdown, the report added. The shutdown is the fallout of new rules laid down by the Financial Services Commission (FSC), South Korea’s financial regulatory body, under the Financial Transactions Report Act. Under the law, foreign and local exchanges will have to register as legal trading platforms, the FT report stated. The FSC said that the rules will enhance consumer protection and prevent unlawful activities. South Korean crypto exchanges must tie up with local banks to open traceable bank accounts for customers in order to obtain a licence to be a legal trading platform. This will effectively lead to banks shunning smaller exchanges for fear of being exposed to illegal transactions, and dealing with only major exchanges in the country, a Stockhead report explained. The four exchanges commanding 90 percent of the crypto market in South Korea are: Upbit Bithumb Coinbit Coinone South Korea is one of the biggest crypto markets in the world. Digital currencies, especially crypto, have witnessed an enthusiastic uptake among young South Koreans because of rising unemployment and surging housing prices. The regulatory overhaul comes at a time when the entire world is grappling with regulating an industry difficult to not only control but also monitor. These rules might set a precedent for other countries to follow as they…
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South Korean traders may lose billions as Seoul tightens its grip on crypto exchanges
The fallout is from South Korea’s stringent new regulations requiring trading licences and tie-ups with local banks.
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