11 Mid-Size South Korean Crypto Exchanges Face Closure Amid Fear of Legal Action

The implementation of new regulatory policies for crypto exchanges in South Korea continues to haunt small and medium-sized crypto exchanges. As per a recent report from Korea Herald, a total of eleven mid-sized crypto exchanges may shut their operations amid growing regulatory scrutiny.

The local report indicated that the country’s top regulatory watchdog Financial Services Commission (FSC) has come across certain illegal activities associated with these exchanges. The exchanges would be asked to shut their operation and might face prosecution for illegal activities as well. The authorities dint reveal the name of the crypto exchanges.

The latest AML guidelines implemented in January this year required crypto exchanges in Korea to do away with fraudulent unnamed collective accounts and open up real-name accounts for customers. However, all of the 200 crypto exchanges operating in the country failed to obtain regulatory clearance by the first deadline. The FSC has now set a secondary deadline until September 24.

Nearly 200 Crypto Exchanges May Go Out Of Business

It seems except for a few top crypto exchanges such as Bithumb, Upbit, Coinone, and Korbi rest all platforms may face closure by September. A majority of small and medium-sized crypto exchanges have made it clear that the new guidelines would leave them with no other option than shut down.

Darlbit was among the first crypto exchange to announce closure on July 15, while CPDAX has announced it would close all its operations by September 1st. Bionic, another mid-size crypto exchange revealed it is temporarily closing its operation for the renewal of its service systems.

The measures put forward by the regulatory body are said to make the crypto market more secure for investors and all to curb criminal activities such as money laundering using digital assets. However, the latest regulatory business threatens to put several crypto exchanges out of business.

A number of countries are now actively having discussions on regulating the crypto market as many governments have called upon regulators to implement investors protection laws. The US lawmakers are actively pressurizing regulators to come up with crypto regulations and many more countries may follow soon.