South Korean Financial Services Commission Probes Crypto Exchanges

South Korea’s Top Financial Watchdog Joins Probe into Cryptocurrency Exchanges

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  • South Korean top financial watchdog (FSC) joins probe into cryptocurrency exchanges.
  • Though FSC does not stand against the use of blockchain technology and digital currencies.

South Korea: On Sunday 13th May, news emerged that the South Korean Financial Services Commission (FSC) has joined the ongoing investigation into local cryptocurrency exchanges. The financial watchdog will now participate in the ongoing anti-money laundering investigation, so far is led by the Financial Supervisory Service (FSS).

Kim Yong-beom, the Vice Chairman of the Financial Services Commission, while remarking on the agency’s move, advised global regulators to coordinate their regulatory policies on digital currencies.

Following the FSS’s request, the financial watchdog will now investigate if bank accounts owned by local cryptocurrency exchanges comply with anti-money laundering (AML) standards and other fraud prevention measures. Korea Times reported that the main subject of the probe would be Bithumb, South Korean’s biggest cryptocurrency exchange, which disclosed its intention to launch own cryptocurrency last April.

Kim stated that notwithstanding the current probe into cryptocurrency exchanges, the financial watchdog does not stand against the application of blockchain technology in banking and financial services and is presently looking into the usefulness of digital currencies as payment methods, the news outlet reported.

The chairman of FSC mentioned the need to communicate an organized international approach to regulatory policies on digital currencies, claiming that “international discussion” is “necessary.” He said:

“We are seeing a steady development of blockchain technology thanks to its greater accessibility and efficiency. Because this technology has the potential to shake up today’s regulations on securities, regulators have to respond to such a looming challenge.”

On 6th May, the new governor of FSS, Yoon Suk-heun, displayed a favourable position towards cryptocurrency, stating its “positive aspects” and claiming that the agency is responsible for providing “remedies to help crypto trading and blockchain technology get better.”

Last week, Cryptona.co reported that South Korean prosecutors raided the offices of Upbit, one of the world’s largest cryptocurrency exchanges, for alleged fraud. This action has led to a downward trend on the cryptocurrency markets.

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