Financial Services Commission of South Korea is planning to regulate all cryptocurrency exchanges directly. On August 6, the Financial Intelligence Unit announced its plan to make all crypto exchanges more transparent by introducing a “cryptocurrency exchange licensing system.”
The head of administration and planning at the FIU, Lee Tae-hoon, said if the exchanges are regulated it would become possible to prevent money laundering through cryptocurrencies. Currently, the FIU indirectly regulates cryptocurrency exchanges through administrative guidance to banks.
“If lawmakers approve the amendment, we can raise the effectiveness of regulations by shifting from the current indirect regulation through commercial banks to direct regulation,” Lee said.
The local cryptocurrencies companies, however, want an explanation on the existing rules of the crypto regulatory framework, including clarity on the issuance of real-name accounts to crypto exchanges by the banks.
South Korea is considered one of the biggest markets for crypto trading in the world. Japan and America are other top countries for crypto trading. According to official estimation, the average crypto investor invested around $6,000 in digital currencies last year. South Korea also recently announced its plan to create a local cryptocurrency for the citizens of Seoul and will also enroll other blockchain-related services by the end of the year.