According to a local report, the South Korean financial services regulator is planning to shut down 11 cryptocurrency exchanges. The 11 crypto firms have reportedly engaged in illegal activities and used fraudulent collective bank accounts. According to the Korea Herald report, the Financial Services Commission plans on denying the 11 local exchanges approval to serve the South Korean market.
Names of exchanges are yet to be disclosed.
The report citing unnamed sources within the regulator claimed that the names of the 11 exchanges have yet to be disclosed. It’s also unclear if these crypto exchanges engaged in any other illegal activities aside from the use of “fraudulent collective bank accounts.” The FSC also plans on implementing stricter regulations for the cryptocurrency industry. In the past year, the financial watchdog has been stepping up its oversight of the industry, which has already led to several exchanges looking at possibly shutting down their operations in the East Asian country.
New crypto regulations prove too much for small exchanges.
The effect of new regulations has been felt most by the small and mid-sized digital currency exchanges. On July 15, Darlbit became the latest exchange to concede to the increasing regulatory scrutiny, announcing that it was shutting down. Two weeks later, CPDAX followed suit, announcing that it would shut down on September 1, three weeks before the September 24 deadline by the FSC for exchanges to acquire operating licenses. “It is not a temporary but a permanent measure to close business. Those who possess cryptocurrencies in the account must withdraw them before 3:00 p.m. on August 31,” CPDAX told its users.