The South Korean authorities are now cracking down on overseas cryptocurrency exchanges as 16 such platforms operate in the country without authorization, local media The Korea Times reported.
Among the illegal platforms are reputed global names like KuCoin and MEXC, which, according to the Korea Financial Intelligence Unit, have allegedly violated the peninsula’s Financial Information Act.
All of these platforms offer cryptocurrency exchange services to South Koreans but did not meet any requirements or obligations under the local legal framework.
The Korea Financial Intelligence Unit already requested the Korea Communications Commission for blocking access to websites and mobile applications of the allegedly illegal crypto platforms. The decision to that is now pending with the latter, which under normal circumstances might take up to a couple of weeks.
A Major Crypto Market
South Korea is one of the major retail crypto markets globally. Despite its small size, the cryptocurrency penetration rate in the country is high, making it a very lucrative market to enter for the international crypto giants.
South Korea is yet to bring any cryptocurrency-specific rules, but the authorities have mandated the reporting of crypto businesses to financial watchdogs.
The rules pushed some of the major global players like Binance, the latest crypto exchange in terms of trading volume, out of the country. However, a total of 16 international exchanges continued their South Korean operations without meeting the obligations.
“Most local crypto exchange operators team up with the government to build a more reliable crypto ecosystem, even if specific legal frameworks have not been introduced so far,” an anonymous industry source told the local publication.
“We expect the authorities to come up with specific measures to root out illegal activities for the healthy growth of the industry.”
Meanwhile, the South Korean watchdog agencies are reportedly opening investigations against $3.1 billion worth of forex transactions linked to cryptocurrency transactions under the suspension of money laundering .
