Loading...

South Korean court rules crypto exchange non-financial institutions

A federal judge in New York dismissed a class-action lawsuit against decentralized exchange Uniswap, ruling that the platform was not liable for fraudulent token sales conducted on it. The judge emphasized that due to Uniswap's decentralized nature, the identities of fraudulent token issuers were unknown, leaving the plaintiffs with no identifiable defendant to blame for their losses.

Contents

Share link:

TL;DR

An exchange versus investor case in South Korea has led to an official ruling that crypto exchanges cannot be considered financial institutions in the country.

The ruling came with the decision of a case where Bithumb, a crypto exchange was defending a lawsuit filed by an investor dubbed Ahn Park.

Park after a successful hack lost over three hundred thousand dollars ($300,000) in the last quarter of 2017. His exchange account was hacked right after the exchange upgraded security. However, Park was not so lucky having lost all of his fortunes.

Park took Bithumb to the court with the rationale that the hack was made possible due to the poor security and as a financial institution it becomes the exchange’s obligation to provide strong security against hackers. The exchange, however, took the stance that their responsibility is not the same as a financial institute since the exchange doesn’t fall in that category.

He claimed that the measures taken by the exchange in 2017 were not fair enough since he might have lost his account login information during the attacked that forced the measures.

The said attack had been a strong blow to the exchange since personal information and data of over thirty thousand (30,000) users is believed to be stolen from Bithumb.

The court ruling, however, saved the exchange by clarifying the basic difference owing to lack of mass cryptocurrency usage in daily routine life. The court decided that the exchange is indeed not responsible for payout as a financial institution since crypto is not a retail currency.

Share link:

Alden Baldwin

Journalist, Writer, Editor, Researcher, and Strategic Media Manager:With over 10 years of experience in the digital, print and public relations industries, he has been working with the mantra, Creativity, Quality and Punctuality. In his waning years promises to build a a self sustaining institute that provides free education. He is working towards funding his own startup.As a technical and language editor, he has worked with multiple top cryptocurrency publications such as DailyCoin, Inside Bitcoins, Urbanlink Magazine, Crypto Unit News and several others.He has edited over 50,000+ articles, journals, scripts, copies, sales campaign headlines, biographies, newsletters, cover letters, product descriptions, landing pages, business plans, SOPs, e-books, and several other kinds of content.

Most read

Loading Most Read articles...

Stay on top of crypto news, get daily updates in your inbox

Related News

Block
Cryptopolitan
Subscribe to CryptoPolitan