Amid Strong Regulatory Action, South Korean Exchanges Warn About ‘Kimchi Coins’

Bhushan Akolkar
June 30, 2021
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Crypto exchanges in South Korea are having a tough time navigating through strong regulatory action initiated by authorities. As a resulted local crypto exchanges have started limiting services to some altcoins while classifying some as ‘kimchi coins’.

Kimchi Premium is one of the most popular terms used in the South Korean crypto market. Being one of Asia’s largest crypto trading markets, cryptocurrencies at South Korea-based exchanges trade at a premium over the global prices, called Kimchi Premium.

Earlier this month, popular crypto exchange Upbit flagged around 178 tokens as “coins to watch”. The crypto exchange noted that “their overall evaluation doesn’t meet internal standards and measures” to protect investors. Besides, Upbit also suspended trading in Korean won for some of the cryptocurrencies, reports Nikkei Asia.

The exchange said that the cryptocurrencies that could no longer be traded using Korean won were the “kimchi coins” like Paycoin. another popular Korean crypto exchange Coinbit also followed suit. It halted the trading in eight tokens while designating 28 others as tokens to be monitored.

The exchange operators noted that these measures are initiated to avoid any friction with the regulators. The coins that were removed from these popular exchanges started plummeting in value across the board. Investors and coin issuers have opposed the recent move from exchanges.

The Rising Regulatory Scrutiny

Earlier in March, South Korean regulators amended new regulations for crypto firms operating in the country. The regulator has asked exchanges to submit a report showing how they have adhered to the new regulatory requirements.

The authorities require exchanges to form a partnership with local banks in order to open accounts with real-name KYC verification.

Some coin issuers have expressed displeasure with the recent actions initiated by Korean exchanges. The developer of altcoin Pica filed a lawsuit in the Seoul Central District Court and is seeking to invalidate the suspension of trading by Upbit.

The developer has also accused Upbit of asking for additional payment in Pica coins over and above the listing fees. Upbit has rejected these allegations saying that the developer has been “maliciously spreading falsehoods” while adding that it would take legal actions.

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Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
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Why Trust CoinGape

CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights Read more…to our readers. Our journal analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.

About Author
About Author
Bhushan is a seasoned crypto writer with over eight years of experience spanning more than 10,000 contributions across multiple platforms like CoinGape, CoinSpeaker, Bitcoinist, Crypto News Flash, and others. Being a Fintech enthusiast, he loves reporting across Crypto, Blockchain, DeFi, Global Macros with a keen understanding in financial markets. 

He is committed to continuous learning and stays motivated by sharing the knowledge he acquires. In his free time, Bhushan enjoys reading thriller fiction novels and occasionally explores his culinary skills. Bhushan has a bachelors degree in electronics engineering, however, his interest in finance and economics drives him to crypto and blockchain.
Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
Ad Disclosure: This site may feature sponsored content and affiliate links. All advertisements are clearly labeled, and ad partners have no influence over our editorial content.