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Korean exchange firms delist altcoin en masse to meet bank requirements

England

TL;DR Breakdown

  • Exchange in Korea delists altcoin to meet regulatory requirements
  • Why exchange have to delist altcoins

Crypto exchange firms in South Korea have been engaging in mas delisting of altcoins to enable them meet requirements to partner with banks in the country.

Many crypto exchanges in the country have begun the delisting process months back, but now many others have joined in fostering their relationships with banks and bolstering their chances with banks that offer real-name accounts for their virtual clients.

Local media reports that the mass delisting comes after authorities in Korea made it compulsory for exchange firms to report their activities to the Korea Financial Intelligence Unit (KoFIU).

For the firms to be in compliance with this directive, Korean exchange firms need to partner with banks that will give them real-name accounts, and if they are unable to meet the requirement, the firms will be forced to shut down.

Why Korean exchange firms need to delist altcoins

Reportedly, exchange firms see delisting altcoins as a means to be more compliant because it is believed that the more coins that an exchange offers, the more vulnerable it is to be used for money laundering and other crypto-related fraud.

Earlier in the year, the government began to raise concerns over the rapid growth of altcoins in many crypto exchanges in the country. They raised serious concern over this because they fear that the country may be a hotbed for crimes and illicit transactions.

Whereas the exchange firms can legally delist any coins on their platform without consulting or getting government approval.

Hence Korean exchanges have listed several altcoins on their platform. They do this at will to draw crypto traders by listing any trending coin that surged at a particular time in the market. The strategy worked for many Korean exchange as their trading volumes sometimes exceed those of more recognized coins like BTC.

However, since their existence depends on delisting these coins and getting bans to partner with, they are axing low-class altcoins that don’t appeal to users till they can meet their target, partner with a bank, and meet regulatory requirement.

Muhaimin Olowoporoku

Muhaimin Olowoporoku

Muhaimin loves writing on crypto news aside from being a crypto enthusiast. He has a knack for analysing issues and updating people on what's happening around the globe. He believes that blockchain and cryptocurrency are the most useful systems of mutual trust ever devised.

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