Bittrex Claims NYDFS’ Problematic Exchange Accounts Were from South Korea, Not North Korea
If Bittrex is to be believed, the New York Department of Financial Services (NYDFS) got the two Koreas mixed up. The crypto exchange has affirmed recently that the New York regulators made a mistake when they identified two users as North Korean in the exchange.
According to the official statement from the regulators, Bittrex had two accounts which were flagged for being North Korean, a country that has received sanctions from the United States and which is not allowed to trade with the U. S. This was part of the reason why the regulators declined to give the BitLicense to the company, in their own words.
However, in a plot twist, Bittrex had already investigated the two investors back in October 2017, so it looks like the NYDFS were wrong this time. They were both reported to be South Koreans that were mistakenly selected, but it was determined later that their IP was actually from South Korea.
The regulators from New York have complained that the company was not being good in detecting which users were actually illegal in the exchange. They also reported that Iranians were using the exchange at the time, as well as the two North Koreans which turned out to be from the southern side of the border instead.
At the time of this report, Bittrex has not contested the fact that at least one Iranian investor used the platform since 2017, but considering that the NYDFS was wrong once, nobody could argue that it was impossible for the company to be wrong twice. When asked about the Iranian accounts, Bittrex affirmed that it had “nothing to add”.
Among the other reasons to not accept Bittrex in the state of New York, the regulators cited that the anti-money laundering practices of the company were very weak and also criticized the coin listing process of the exchange.
After the denial of the BitLicense, Bittrex has accused the NYDFS regulators of wanting to have too much information about the clients which dealt with the exchange. According to them, it was a breach of privacy, as the department was asking for the information of people who lived outside of the state in order to clear Bittrex to get the license.