TL;DR Breakdown
- The South Korean government had a meeting with officials from 20 crypto exchanges.
- The officials were gathered behind closed-doors and no press was allowed.
- Sources claim the exchanges explained their grievances in the meeting.
- These exchanges were relatively smaller and newer ones.
A South-Korean organization called the Financial Services Commission decided to convene a closed door meeting with officials from 20 crypto exchanges of the country. The reason for this meeting was the officials from the crypto exchanges intending to convey their thoughts and grievances to the government regarding the newest rules that the government had imposed.
According to the new rules that were implemented on 28th May by the South Korean government, these 20 crypto exchanges will have to comply with the Virtual Asset Service Provider report. This report involves the implementation of various rules regarding the working of crypto exchanges in the country. The new rules were established so that no person will be able to indulge in criminal activities using crypto exchanges in South Korea.
What rules were implemented for crypto exchanges in South Korea?
There are multiple issues that the crypto exchanges in South Korea were dealing with after the establishment of the ASP or Asset Service Provider report was put into effect. These rules demanded the exchanges to obtain Information Security Management System certificates along with the provision for opening real-name trading accounts.
This was very important because of the existence of notorious and criminal users of crypto exchanges. In South Korea, only the biggest fishes had the capacity to open real-name trading accounts. These 4 crypto exchanges include Bitthumb, Korbit, Upbit, and Coinone. The rest of the 16 exchanges were not able to do so because of many difficulties, most important among them being operational limitations.
Was a deal made?
It has been revealed that the government of South Korea made a parley with these 16 small-scale exchanges and that there was a conclusion that was reached in the meeting. As the meeting happened without anyone knowing, or any briefing to the press, one can only speculate the internal stipulations of the deal that was made.
Also, the Financial Service Commission (FSC) recognized that the problems faced by these exchanges were indeed genuine. As a result, the FSC decided to not interfere and cause disturbances in the deal that these exchanges had with the banks in South Korea. This is because the FSC needs these exchanges to form a relationship with banks.
The relationship that the FSC wanted with the banks was not possible because not all exchanges have the capacity enough to partner with a bank. Therefore, the FSC decided to recognize these problems of the South Korean exchanges. The strictness of policies was done to prevent the illegal use of crypto and therefore, it can be said that the government of South Korea has planned a future with cryptocurrencies generally.
