12 Korean Crypto Exchanges Pass Self Regulatory Probe
The Korean Blockchain Association (KBA) just announced the results of a self-regulatory review of Korean exchanges, stating that all exchanges assessed fulfill the minimum requirements established by KBA in April 2018.
The announcement by KBA came just days after the Korean government revealed its analysis of hacking incidents in the country. The government has been criticized for not doing enough to prevent hacking damages since three of the 31 exchanges it inspected were hacked, causing damages of about US $98 million.
Although the news has recently broken that 12 crypto exchanges in Korea have passed the standard checks, it seems that a few of them barely made it to the other side, said the Korea Blockchain Association (KBA) in a statement on Wednesday. Although the exchanges made it through the general requirements with little to no problems, including the recently hacked Bithumb, there were large differences between the passing levels of the trading platforms in question.
The general standards included some anti-money laundering (AML) provisions, issues regarding the adoption of cold wallets and also the total of minimum assets required. However, there was news of some security issues with some of the exchanges, the KBA is keeping tight-lipped on the details so they cannot be used against the Korean crypto exchanges by cyber-hackers.
However, following the KBA’s announcement, some industry participants pointed out major flaws in the inspection. The KBA even extended its one-month inspection to two months to allow sufficient time for underprepared exchanges, inviting criticism for carrying out an inspection in name only.
The KBA did not disclose a detailed score or security rating of each cryptocurrency exchange, casting doubt about the fairness of the inspection. The KBA said the disclosure could trigger another cyber attack on domestic exchanges with weaker security firewalls.
New and revised anti-money laundering bank regulations were enforced on the Korean crypto industry by the nation’s Financial Services Commission (FSC). It is now law that banks and other financial companies carry out due diligence on crypto exchanges, regarding non-client accounts, which means they need to share information regarding oversees digital trading platforms with its FSC. This could then result in halting suspicious crypto transactions.