Crypto.com Delays South Korea Launch Amid Regulatory Scrutiny
Crypto.com, a Singapore-based cryptocurrency exchange, has postponed its planned launch in South Korea due to regulatory concerns. The decision comes after South Korea’s Financial Intelligence Unit (FIU) initiated an emergency on-site inspection of Crypto.com’s local office, citing potential anti-money laundering (AML) issues.
The inspection, which occurred on April 23, was prompted by findings of potential AML concerns in the data submitted by Crypto.com The FIU, operating under the Financial Services Commission (FSC), is responsible for overseeing AML measures in the country’s cryptocurrency sector.
Crypto.com had announced plans to launch a local trading platform in South Korea on April 2, aiming to fill the gap left by the closure of OkBit, a domestic exchange acquired by Crypto.com However, the regulatory hurdles have proved challenging for the crypto exchange.
South Korea has recently updated its guidelines, requiring all foreign digital assets to publish a white paper or technical manual specifically for the South Korean market before listing. The new regulations, set forth by the Financial Supervisory Service, also prohibit the listing of digital assets associated with hacking incidents unless their root causes are comprehensively addressed.
Crypto.com has emphasized its commitment to maintaining proper AML standards and is taking decisive steps to ensure its policies and procedures meet the expectations of South Korean regulators. The exchange has not onboarded new customers in Korea since the acquisition of OKBit, which maintained about 900 customers at the time of purchase. Since then, access for existing OKBit customers has been restricted to withdrawals only.
The delay in Crypto.com’s South Korea launch highlights the stringent regulatory environment in the country. South Korea has been at the forefront of regulating cryptocurrency trading, with a focus on combating financial crimes within the sector. The country’s approach could shape a more secure and responsible future for the global cryptocurrency domain.
