South Korea’s financial inspector has set a deadline for the ban on anonymous cryptocurrency trading accounts within the country.
In accordance with a new announcement from the Financial Services Commission (FSC), starting from Jan. 30, cryptocurrency investors in South Korea will have to use real-name bank accounts in order to keep trading.
When the rule comes into effect, investors can only deposit funds to trade cryptocurrencies if their name on the crypto exchange matches that on their bank account.
The step comes as part of the financial regulator’s push through a strengthened “know-your-customer” (KYC) agreement to constrain cryptocurrency speculation. The FSC said in the release that the new rule is resulted from an inspection of domestic anonymous crypto trading accounts – assisted by 6 domestic banks, as well as the Financial Intelligence Unit – from Jan. 8–16.
Adding to that, the official announcement also founded an anti-money laundering guideline for cryptocurrency exchanges, which outlines situations where exchanges should stay vigilant to potential illegal activity.
The statement said:
“Specifically, for users to make virtual currency transactions more than 10 million won per day or more than 20 million won for 7 days when depositing and withdrawing funds, this is the type of financial transaction you suspect for money laundering.”
The new regulation has a broader effect on foreign nationals who had been using cryptocurrency exchanges in South Korea through a virtual bank account. As the FSC’s announcement stated, minors and non-citizens will be restricted from the new name verification service.
So far, 3 major cryptocurrency exchanges in South Korea have said they are in line with the new mandate.
In an email reply to Coinstelegram, a representative from Coinone confirmed that it will impose the change starting from Jan. 30. “Under the new requirement, 6 banks are preparing the real-name account linkage with exchanges. They are NongHyup, KookMin, Shinhan, KEBHana, IBK, and JB Bank. As for Coinone, our users have to be registered with NongHyup for the time being,” the company said.
Furthermore, in its official blog post, Korbit also said on Jan. 19 that the existing fund deposit method will be restricted and replaced this month. It added that users “must have a Shinhan Bank account registered under your legal name.”