The Financial Intelligence Unit (FIU) has accepted Coinone’s compliance report with South Korea’s latest crypto regulations, while Bithumb is left as the only crypto trading platform out of the country’s four major exchanges to not be officially registered under the FIU.
Fast facts
- Coinone became the third official cryptocurrency exchange of South Korea, following Upbit and Korbit — two months after it had submitted its business report proving full compliance with the Act on Reporting and Use of Certain Financial Information on Sept. 10.
- Meanwhile, Bithumb, which submitted the report a day earlier than Coinone, has not been accepted as a legitimate virtual asset exchange although the two exchanges were reviewed together by the FIU. Local media reports associate the situation with the fact that Bithumb’s major shareholder of the exchange and former chairman of Bithumb Holdings, Lee Jung-hoon, is on trial after being indicted with fraud charges that date back to 2018.
- Once licensed under the FIU, virtual asset exchanges are obliged to comply with the financial authority’s know-your-customer (KYC) and anti-money laundering (AML) requirements.
- Bithumb told the media that the financial authorities did not reject the compliance report but are only putting it on hold. It added that although it does not know in detail the reason it was put on hold, it will submit additional data if required.
- South Korea’s latest crypto regulations mandate exchanges comply with two major standards: obtaining the Information Security Management System (ISMS) certification and securing a bank contract that will provide users with real-name withdrawal and deposit accounts to increase transparency in transactions. Only four exchanges — Upbit, Bithumb, Coinone and Korbit — met both requirements.