South Korean authorities will tighten control over local cryptocurrency exchanges, expanding the powers of the Financial Services Commission (FSC), reports Business Korea.
Thus, the FSC unit, previously engaged in the preparation of recommendations for working with exchanges for banks, will now directly control trading platforms. Also, according to officials, a licensing system for exchanges will be introduced in the country in accordance with the recommendations of the Financial Action Task Force on Money Laundering (FATF). This, the Commission is sure, will increase transparency in the crypto industry.
If an amendment to the Act on Reporting and Use of Certain Financial Transaction Information, which reflects the FATF’s international standards for cryptocurrencies, passes the National Assembly, it will be possible to prevent money laundering through cryptocurrencies.
Head of administration and planning, FIU
The official expressed the opinion that the transition from indirect regulation to direct will make control over the sector more effective.
In June the FATF introduced the final version of the guidelines for the cryptocurrency industry. They say that bitcoin exchanges and other cryptocurrency service providers must follow AML and CFT (counter-terrorism financing) procedures, similar to traditional financial companies.
Soon after the publication of the new FATF rules, South Korean banks tightened requirements for local cryptocurrency exchanges.