South Korean watchdog takes action against unregistered foreign crypto exchanges.
The Korea Financial Intelligence Unit (KoFIU), which aims to prevent money laundering and illegal fund flows in South Korea, has blocked 16 unregistered foreign crypto exchanges.
According to a press release shared by the Financial Service Commission (FSC), the Korean financial watchdog has reported more than a dozen crypto exchanges to the country's investigative authorities. The KoFIU is asking FSC to permanently block user access to listed companies.
Did you know?
Want to get smarter & wealthier with crypto?
Subscribe - We publish new crypto explainer videos every week!
What is Curve Finance in Crypto? (Animated Explanation)
The unregistered crypto exchanges are KuCoin, MEXC, Phemex, XT.com, Bitrue, ZB.com, Bitglobal, CoinW, CoinEX, AAX, ZoomEX, Poloniex, BTCEX, BTCC, DigiFinex, and Pionex.
In the press release, when noting crypto exchange violations, KoFIU said:
The 16 foreign-based VASPs were found to have been engaged in business activities targeting domestic consumers by offering Korean-language websites, having promotional events targeting Korean consumers, and providing a payment option that supports the purchase of virtual assets using credit cards.
In order for crypto exchanges to provide these services, they must be registered with the Korean authorities. However, the listed companies were attempting to dismiss this requirement.
The KoFIU is planning to report these exchanges to the FIUs of their respective countries. If these companies were found guilty, they could face up to five years in prison, a fine of around 50 million South Korean won (around $37,000), or can be banned to provide their services in the country.
South Korean authorities are taking strict measures to ensure the safety and fairness of the crypto sector in the country. The Korean government aims to register all local and foreign crypto-related businesses until September 24th. The companies that decide not to comply with this rule will face criminal prosecution, fines, or will be banned.
South Korea is not the first country to take such measures. On August 10th, Uzbekistan blocked users from accessing unlicensed crypto exchanges and their services.
In other news, South Korean police in a little town of Gunpo seize crypto assets in offenders' digital wallets if they have failed to pay hefty traffic fines.