South Korea’s Financial Services Commission today revealed plans to ban cryptocurrency exchanges in the country from listing their own coins.
Fast Facts:
- The FSC has proposed amendments to existing legislation on cryptocurrency exchanges, under which all exchanges would be barred from listing tokens that they have issued. The FSC’s proposals come following signs of price manipulation by exchanges.
- If the amendments are enacted, several cryptocurrencies may become unavailable to investors. Maro coin, owned by Dunamu & Partners, the operator of Upbit, was delisted from the platform on June 11 due to a “failure to meet requirements to maintain the [Korean won] market.” Huobi Korea, another South Korean exchange, announced the delisting of its native token earlier this week, saying the move was intended “to better meet government standards for crypto exchanges.”
- Another amendment to regulations will prohibit exchanges’ staff and executives from trading on their own platforms due to the potential for conflicts of interest. The FSC forewarned exchange officials of the proposed prohibition earlier this month, prompting exchange executives to argue that it would block fund flows essential to the industry.
- An additional planned move is to beef up risk assessments of individual customers. Risk assessments are currently carried out to identify high-risk customers, but the FSC proposes extending them to all customers. In the case of group or institutional investors, it wants the name, date of birth and nationality of a representative member to be specified.
- The FSC’s proposed measures will be the subject of an internal government and regulatory review from today until July 27.