The South Korean financial market regulator wants to scale up the control of the cryptocurrency industry. It was confirmed that the inspection is to be carried out on 60 national exchanges with digital assets. The entire process is to take place in cooperation with the police and independent IT inspectors.
Cryptocurrency exchanges controls
The Financial Services Commission (FSC) of South Korea – the equivalent of the Polish KNF – is to take complete control of the cryptocurrency industry.
FSC has already invited representatives of 30 leading cryptocurrency exchanges. This group includes companies that have either already obtained the necessary data protection information security management system (ISMS) certification to continue their operations after September 24, or are in the process of doing so. After September 24, exchanges without ISMS will not be able to operate.
Earlier this month, the media reported that the FSC carried out a week-long audit of one of the largest stock exchanges in Seoul. Now it seems the FSC wants to go a step further. After a series of smaller stock exchanges that did not seem to intend to apply for business permits began to close – cutting investors off their funds – the authorities’ fears of their “Deliberate bankruptcies” they are tall.
FSC is afraid that unscrupulous stock exchange owners may apply for insolvency on the eve of September 24. This will prevent them from returning fiat currencies and cryptocurrencies to investors who have deposited funds on their platforms.
As part of its efforts, the regulator joined forces with several ministries and state-owned IT companies. The new inspections planned by the authorities will include “Full examination of corporate accounts”, and analyzing protocols “Coin management and investor protection” trading platforms.
The state has also hired independent IT specialists from the private sector to join the inspectors in their research.
“Potentially uncooperative exchanges are likely to be on the wrong side of the law”, the government warned.
What are the controls supposed to consist of?
Inspection teams will have the right to “taking over “ documents, computer hardware and other items, and “Search.”“Rooms”with the help of the police “if the need arises.
The media quoted a government official who stated that “Lack of cooperation with inspection teams may be interpreted as an attempt to hide insolvency. We plan to look at such cases, even if we have to mobilize the police to do so. “