South Korea cracks the whip on crypto exchanges as prices tumble

Karthik Subramanian

South Korea’s Financial Services Commission has begun to crack its whip on virtual asset service providers, which basically means the cryptocurrency exchanges, and has asked them to register with itself by September 24.

It also goes on to specify that those exchanges and platforms that are not ready to offer Korean currency-based operations should stop providing the services for the same and they should not be dealing with such fiat currencies any longer unless and until they get registered and licensed to carry on the same. For those who decide to shut it down, the FSC has said that they should be submitting an undertaking that they have done so.

The FSC has also said that those who shut down such operations would need to do so in a manner that the users are not affected by it by giving proper intimation and enough time for the users to learn and understand the new changes and also to withdraw the funds that they want to.

This announcement has come as a big blow not only to the crypto exchanges and traders in South Korea but for the entire crypto ecosystem as such. South Korea has generally been very supportive of the cryptocurrency ecosystem over the last couple of years and the exchanges in the country have been some of the most active ones in Asia during this period with transaction volumes at these exchanges being one of the highest in Asia. This move is expected to affect around 40 out of the 60 crypto exchanges in South Korea and they are expected to shut down in the coming months.

“A situation similar to a bank run is expected near the deadline as investors can’t cash out of their holdings of ‘alt-coins listed only on small exchanges,” said Lee Chul-Yi, head of Foblgate, a medium-sized crypto exchange. “They will find themselves suddenly poor. I wonder if regulators can handle the side-effects.”

Those coins/tokens that are denominated in the Korean won currency are likely to be removed from the exchanges which means that they also would need to shut down. As a result of this announcement, we have seen a large fall in the crypto prices in the morning as a lot of transaction volume is going to dry up from the crypto industry as the Korean won is the third most used fiat currency as far as crypto trading is concerned.

Read this next

Inside View

Libertex founder’s family denies any links to Russian government

Vyacheslav Taran, 53, founder of Forex Club and CEO of Libertex Group, was the sole passenger of a helicopter that crashed in Villefranche-sur-Mer this weekend. The helicopter crash is still under investigation, and authorities have not indicated any possibility of foul play.

Digital Assets

Despite FTX chaos, Italy welcomes crypto lender Nexo

Crypto lender Nexo has won regulatory approval from Italy’s financial regulators, allowing the exchange to continue serving Italian customers.

Institutional FX, Interviews

ION Markets for execution and clearing: Francesco Margini at FIA EXPO 2022

The CPO of Cleared Derivatives at ION Markets spoke about the need for automated execution and clearing in times of surging volumes and increased volatility.

Institutional FX

FIA EXPO 2022: Baton Systems President on building post trade rails for capital markets

As the world’s largest trade show for the listed derivatives dealers, the FIA Futures and Options Expo is a high point for the global cleared swaps community, with dozens of panels, educational sessions, networking opportunities and more.

Industry News

Brokeree Solutions Wins the “Best Emerging Fintech” Award

2022 has become, for Brokeree Solutions, a time of new inventions and developments. We are pleased that the industry has appreciated this emergence of new technologies

Metaverse Gaming NFT

Glip raises $2.5 million to develop class-A Web3 games ecosystem

Web3 game discovery & wallet app, Glip has raised an additional $2.5 million in new funding from a range of investors, bringing the total investments it received to $6 million thus far. 

Inside View

Black Friday and trading: OctaFX presents the results of its client survey

What are the attitudes of traders toward the Black Friday period? What are their trading patterns during the shopping season? OctaFX asked its clients all the most important questions.

Retail FX

Dukascopy warns of clone website dukascopyd.swisbank

Switzerland’s forex bank and broker, Dukascopy has alerted the market and consumers to a clone of its authorised brand. The website, which remains active, is impersonating the genuine investment firm in an attempt to deceive people into handing over their hard-earned money.

Crypto Insider

A Step-by-Step Guide on How to Get a Crypto Wallet

The crypto ecosystem is very much based on the existence of a crypto wallet, as it is the gateway that allows users to securely store their assets with full transparency and protection.