BCGAME - Free 5BTC Daily Bonus!The Financial Services Commission, South Korea's chief financial regulator, is reportedly staging the closure of some cryptocurrency exchanges. This move is linked to allegations of fraud on these exchanges.
The FSC's first move is to temporarily interrupt the operations of around 11 medium-sized South Korean cryptographic centers. Reporting on Sunday, The Korea Herald, a local news agency, said the FSC's move is based on some unclear operations of these exchanges.
The report claims that all of these exchanges allegedly had fraudulent collective accounts and some illegal activities.
According to a news publication, although citing unknown industry sources, there is still no release of the names of the exchanges. However, these exchanges will likely never get approvals for operations from the authorities.
From news sources, the FSC will refuse operational approval for all affected encryption changes. In addition, this South Korean financial regulator plans to enforce stricter regulatory actions on smaller stock exchanges.
News of the alleged accident comes amid the recent suspension of operations for a small encryption exchange in South Korea. One such suspension is the announcement made by Bitsonic, a local cryptocurrency exchange, on Friday.
A post on its official Telegram channel said the switch would make a temporary operational disruption due to internal and external challenges.
Likewise, CPDAX, another minor encryption exchange, said it would end operations as of September 1st. Aforenow, the Darlbit exchange had closed operations. This happened after suspending withdrawals and deposit services last month.
However, the FSC has yet to respond to its recent plans to stop these growing encryption switches.
Tighter regulatory measures for cryptocurrency exchanges in South Korea
Following the recent trend of events, there have been stricter regulatory moves on cryptographic exchanges in South Korea. The country's financial regulators have required full registration for all local cryptographic service platforms.
In addition, authorities gave them until September to establish non-fictitious business accounts and registration systems. According to the report, customers' real or non-fictitious name accounts are part of the prerequisites for operating their business.
In line with its regulatory measures, the FSC is planning to ban cross-trade between crypto exchanges. The agency sees this as illegal trade, as it hides the flow of transactions.
Cross trading is the means by which trading platforms buy or sell orders for an asset without a reflection on your order book. In addition, cross trading allows these cryptocurrency exchanges to earn trading fees. Therefore, your ban will have a significant negative impact on your revenue stream.
Both the country's medium and minor cryptographic changes are in a fix as per the instruction. For them, trying to get approval from the relevant authorities has not been easy. However, bigger players like Coinone, Korbit, Bithumb and Upbit are not scared by the obstacle.
In addition, recent regulatory measures in South Korea have spilled over to the country's largest encryption exchanges. A Yonhap News report reveals that the Seoul Metropolitan Police Agency on Monday called an investigation case.
The case was an alleged fraud that connects the former president of Bithumb, the largest exchange of cryptocurrencies in the country.
