South Korea’s FSC Chairman Confirms Bank Support for Crypto Businesses With AML and KYC Protocols
Chairman With South Korea’s FSC Confirms Support From Banks For Crypto, As Long As They Adhere To AML And KYC Protocols
A new report from Token Post on October 30th shows that the new and existing cryptocurrencies in South Korea should have no worries about interacting with banks in the area. This confirmation was made by the commissioner of the Financial Services Commission of South Korea, Choi Jong-Ku, in correlation to the decision to offer virtual bank accounts to crypto exchanges.
This agreement does not come without stipulations. After an audit evaluated the many government agencies and commissioners, commissioner Choi specifically noted the importance of following the same systems that banking institutions do to maintain their security. Know-Your-Customer (KYC) and Anti-Money Laundering (AML) protocols are crucial to preventing fraud, and the digital asset platforms need to adhere to them to keep the banking services.
Commissioner Choi said,
“There exists no issue in banks providing virtual bank accounts to cryptocurrency exchanges. If digital asset trading platforms have KYC and AML systems in place, there is no problem in issuing virtual bank accounts to exchanges.”
One of the unique benefits in South Korea’s banking system with cryptocurrency is the option to deposit and withdraw KRW tokens that they are awarded instantly, supporting better security on exchanges.
South Korea has been one of the many countries that has had a mixed relationship with cryptocurrency. Towards the beginning of this year, the government was urging banks to avoid participating with crypto exchange, reducing the risk of money laundering with their assets. However, the Nonghyup commercial bank has continued to work with crypto exchanges for over a year and supporting them with their own banking services. They were even encouraged to cut ties, but they did not. Now, with the new changes to their protocols, crypto exchanges will not have to be without banking services again.
The South Korea Blockchain Association has maintained an optimistic stance on these welcoming changes, and even noted that the worries that the government had then have since been resolved. In the effort to get approval from the government, there are many cryptocurrency exchanges that have modified their security measures. Coinone, Korbit, Upbit, Gopax, and Bithumb are among the many to already be approved. Security analysts with KISA and the Ministry of Science and IT have already confirmed their security adjustments.
Bithumb, for example, is the second-largest crypto exchange within South Korea, and they have eliminated all banking options beyond Nonghyup. However, this let investors in cryptocurrency to experiment on other exchanges, like Gopax, which supports deposits and withdrawals with all banks.
Right now, the latest decision that is pending change is the stance on Initial Coin Offerings (ICOs). Though they have been banned since September 2017, there is a pending announcement in November that may end up reversing the restriction placed on it.