South Korean Financial Watchdog steps in to Probe Crypto Exchanges

South Korea Crypto Exchange

In a report from local news outlet Korea Times, South Korea’s top financial watchdog announced they were joining the current probe into cryptocurrency exchanges in the country. The announcement came last Sunday, May 13th.

The Financial Services Commission (FSC) will now be taking in part the anti-money laundering investigation, currently led by the Financial Supervisory Service (FSS), in order to help expand its scope.

Vice Charman of the FSC Kim Yong-beom has also urged regulators worldwide to coordinate their regulatory policies on cryptocurrencies.

Following a request from the FSS, the FSC will now start checking bank accounts that belong to Korean crypto exchanges for compliance with anti-money laundering (AML) standards and other fraud prevention measures. According to reports, it looks like the main subject of the expanded audit appears to be Bithumb, South Korea’s largest crypto exchange which recently announced their own plans to launch a crypto token.

According to the Korea Times, Kim Yong-beom said despite the investigation, the FSC does not oppose the use of blockchain tech in banking and financial services and is currently evaluating the usefulness of cryptocurrencies as a means of payment.

The FSC’s Chairman also noted the urgent need to communicate a coordinated global approach to regulatory policies on crypto, arguing that “international discussion” is “necessary.”

“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.”

He continued.

Last May 6th, newly appointed FSC governor Yoon Suk-heun took a favorable stance towards cryptocurrencies, noting its “positive aspects” and saying that the agency is responsible for providing “remedies to help crypto trading and blockchain technology get better.”

South Korean Police have also started a probe into Upbit, one of the top crypto exchanges in the country, for alleged fraud.

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