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South Korea ends anonymous Cryptocurrency trading

South Korea ends anonymous Cryptocurrency trading

SEOUL: Korean cryptocurrency traders will no longer be able to trade cryptocurrencies like Bitcoin and Ethereum anonymously. Last week, major cryptocurrency exchanges in the local market including Korbit and Bithumb announced that starting Jan. 30, anonymous traders will be prohibited from investing in the market. Beginning today, investors are required to undergo a rigorous verification process to invest in the market. Kookmin Bank, the country’s largest bank, has also stopped providing virtual bank accounts to cryptocurrency exchanges. In South Korea, trading platforms provide each trader with a virtual bank account with which traders can use to withdraw and deposit Korean won without using actual bank accounts. From the virtual bank account, traders can then withdraw to their real bank accounts.

Instead, Shinhan Bank, South Korea’s second-biggest bank, along with five more financial service providers have started to support cryptocurrency businesses and investors. Existing traders are required by local exchanges to use bank accounts from Shinhan Bank and other banks in the country that support cryptocurrency investment. In early December of last year, South Korea’s Justice Minister Park Sang-ki was heavily criticizedfor his premature statement on a non-existent cryptocurrency trading ban bill. Evidently, since then, the South Korean government has worked towards regulating the market, ensuring that investors are protected and businesses are compliant with regulations.

It is optimistic that the South Korean government has taken the approach of regulating the market rather than banning cryptocurrency trading, as minister Park suggested in December. But, experts fear that the South Korean government is imposing excessive regulations onto the local market that may hinder developments within the cryptocurrency sector.