Banks in South Korea Instructed to Treat Crypto Exchanges as High-Risk Clients
South Korea’s banks have been instructed to treat crypto exchanges as high-risk clients by the country’s financial regulator.
The Financial Services Commission (FSC) said crypto exchanges must be subject to strengthened transaction monitoring and ID verification, the Korea Times reported Sunday.
Banks will be required to deny services to clients that do not comply with ID verification requirements or fail to report suspicious activity to the FSC’s anti-money laundering unit, the Korea Financial Intelligence Unit.
Exchanges will have to terminate transactions made by accounts that are not real-named based or have not been verified using the necessary identity checks.
Of 60 exchanges in the country, only four are using real-name accounts that meet this standard, according to the Korea Times.
This latest statement of intent by the FSC around stricter regulation of the crypto industry comes as exchanges have until Sept. 24 of this year to register as virtual-asset service providers (VASPs) for the regulator to then assess the legality of their operations.
