South Korea’s ‘Big Four’ Crypto Exchanges Survive Despite Restrictions
h2: âBig 4â coin trade in South Korea is strong
29 of 66 South Korea-based crypto exchanges had rushed to meet a regulatory deadline stipulated on September 24. As a result, the market now expects major consolidation with only solid ‘Big 4’ coin trading.
According to local reports, only Upbit, Bithumb, Coinone, and Korbit have successfully partnered with local commercial banks in accordance with the country’s revised guidelines. While all regulatory challenges were not yet over, all four exchanges could allow cryptocurrency trading in exchange for Korean Won.
However, it may take up to three months to review the outcome of the 29 registration applications submitted. From now on, the exchanges will be subject to regulatory compliance on issues such as money laundering. By March, all approved exchanges will have adopted the Financial Action Task Force (FATF) anti-money laundering standards known as the âtravel ruleâ.
Any breach of compliance will result in penalties or even the closure of crypto companies, according to reports. At present, 37 exchanges without the required registration could be on the verge of closing.
Meanwhile, other coin exchanges, including GOPAX, Gdac and Huobi Korea, have reportedly not partnered with any commercial bank. Therefore, they only provided trading services for cryptocurrencies and could not be exchanged for fiat currency.
A cryptocurrency exchange official told local media,
“It is significant that many unqualified exchanges are resolved during the registration process.”
Registered exchanges, crypto wallets and trust companies were all trying to obtain a government license under the revised terms. However, the rest of the unregistered businesses that could close in the next few days are not expected to have a major impact on the market. But, experts said stopping Korean won exchange services would hurt the revenues of other coin exchanges.
In addition, there were other growing concerns, as the “Big Fours” will dominate the market under an oligopoly. Local reports also indicate that currently the National Assembly had four bills on its table. These bills, along with other forthcoming proposals, may provide more clarity on the regulation of the sector.
During this time, there is a high level of uncertainty which will take time to dissipate. So, if one of the existing partnerships between exchange banks and banks dissolves, the consequences are unclear.