Finally, things are getting better in South Korea. Within a week six country’s banks will be able to permit contemporary opening of accounts, withdrawals, deposits, as well as remittance of bankroll between these accounts and virtual money exchanges. However, there will remain one main restriction: banks will have the right to open only real-name registered accounts. But no anonymous accounts even since January 30 – end of story.
The announcement was made by South Korean officials on January 23, as they marked the prolongation of the ban for the use of unidentified accounts in virtual money trading platforms, The Korea Times reported.
Good For Banks
Some weeks ago the South Korean authorities prohibited the opening of cyber currency accounts but promised to unban it provided that banks launch the system which guarantees that only real-name registered accounts, as well as corresponding accounts at cyber money exchanges, are utilized for withdrawals and even deposits.
So now, as the banks have come out with the prepared system, they can continue running a business successfully. There are six particular South Korean banks which have been approved by the authorities. Among them, there are the Industrial Bank of Korea, NH Bank as well as Shinhan Bank.
As it is known, such an approach is one of the plans of authorities’ gauges on tying up the speculation in the crypto market. The reason why the state started the campaign is that of the growing fears over crypto bubble going off. That would damage not only South Korea, where crypto trading is a bandwagon, but very probably the worldwide crypto market as it makes up 10% of the global bitcoin-trading. Moreover, the South Korean cyber money market is the third biggest in the world. Millions of people are estimated to possess bitcoin, so the consequences of South Korea’s insufficient regulation can be devastating.
Still Not Bullish For Exchanges
Despite the better understanding of how the banks will have to deal with crypto trading platforms, exchanges in South Korea remain substantially unregulated. Merely, they have not been accepted as financial products yet. Furthermore, according to the novel real-name trading setup, exchanges now will have to unveil customer’s operational information to the banks. The country also does not have any regulation concerning the protection of cyber money investors.
Penalty For Ignoring Security Measures
Another troubling issue for South Korean cyber money exchanges has been the announcement that they will be penalized for inappropriate safety standards. Eight largest South Korean virtual trading platforms, including Coinone, RippleForYou, Coinplug, and Upbit, will have to contribute to the country’s coffer from $10,000 to $25,000.
The major crypto exchanges in the country, excluding the second largest Bithumb, have been recently fined by South Korea Communications Commission (KCSC) for $130,000 on the whole. According to news reports, the reason was that these platforms did not satisfy the rules implemented in the Information and Communication Network Act and Privacy Act.
Primarily, there were investigated ten crypto exchanges, and eight out of them were found guilty of inappropriate security measures policy. As it was mentioned in the official statement of KCSC, the platforms nearly neglected such gauges as storage of clients’ passwords, device setting, and functioning as well as the vindication of customers.