South Korean crypto exchanges face strict new regulations in just 7 days
E-Yuan launch in final stretch
On the ground in El Salvador as Bitcoin is put to the test
We’ll have more on those stories — and other news shaping the cryptocurrency and blockchain world — in this episode of The Daily Forkast, September 17th.
Transcript
Welcome to The Daily Forkast, September 17th 2021. I’m Angie Lau, Editor-in-Chief of Forkast.News covering all things blockchain.
We’re just seven days away from strict new crypto regulations in South Korea going full effect. Any exchange that has failed to meet its standards by the 24th is ordered to close down services partially or even entirely. But we’re finding out much earlier than that. The latest on that story and much more coming up.
Let’s get you up to speed from Asia to the world.
All right. In South Korea, there may be dozens and dozens of crypto exchanges, except all but four exchanges, have yet to fulfill new regulatory requirements as the September 24th deadline quickly approaches, noncompliance means exchanges need to shut down.
Many are now desperately calling for an extension of the grace period. No mercy, though authorities say those exchanges must announce their closure by tonight, which may go down in history as Black Friday for crypto exchanges in South Korea.
Forkast.News reporter Danny Park has more.
South Korea’s Financial Services Commission has laid down the law, but only four of Korea’s largest crypto exchanges.
Upbit, Bithumb, Coinone and Korbit have managed to comply with just a week left for the country’s virtual asset exchanges to fully comply with the new regulations.
There are two requirements obtaining the Information Security Management System certification and partnering with a local bank to provide users with bank accounts under their real names.
Exchanges that fail to meet both criteria will be shut down, while those that have acquired the ISMS but not the bank contract, must operate after wiping out their cash-to-crypto functions.
The government mandates that the exchanges notify their users seven days prior to closure, which is today.
35 is a number of exchanges that haven’t secured the information security certification and that will perish next week. That’s more than half the total number of exchanges in the country.
24 exchanges that only managed the certification will operate as token-to-token services from September 24th.
Foblgate, Bitcmon, Coredex and Flybit have already announced the closure of their Korean won-to-crypto markets.
One expert believes the likelihood of these 24 exchanges to complete the bank contract requirement is less than 10%.
“[For one thing], there isn’t much time. And secondly, [the banks] have criminal and civil liabilities [for partner exchanges]. So they are being very careful in reviewing partnerships. For these reasons, I say the chances are less than 10%”
Kim adds considerable damage is expected from this mass closure, but that it is a necessary passage for the industry to move forward.
For Forkast.News, I’m Danny Park.
Meanwhile, in China, the launch date of a central bank-backed digital currency, or E-CNY, is becoming more clear.
Olympic athletes, get your digital wallets ready because that may be the only way you can buy anything, souvenirs or otherwise at the 2022 Olympic Winter Games.
Timmy Shen has more from Taipei, Taiwan.
Fan Yifeng, deputy governor of the Chinese central bank, said that the E-CNY pilot preparation of the Winter Olympics is in the sprint stage.
He said that in a journey to investigate the progress of the E-CNY Winter Olympics pilot earlier this week, the 24th Winter Olympic Games will be held in Beijing and Zhangjiakou on February 4th 2022. With tens of thousands of participants from various countries, E-CNY will undergo the first crucial international test.
However, in July, Some U.S. senators urged American athletes to boycott digital yuan at the games, citing privacy concerns.
According to the E-CNY white paper released by the People’s Bank of China, non-Chinese travelers can use the CBDC in small amounts while remaining anonymous.
Vending machines, vending cards, and unmanned supermarkets that support digital RMB payments will be present in the Olympic Park.
Currently, China has issued 18 batches of digital Renmenbi red envelopes with a total value of over US$43 million in nine cities across the country to promote the adoption of the digital yuan.
For Forkast.News, I’m Timmy Shen, Taipei, Taiwan.
And finally, today, switching gears and switching continents.
It’s been just over a week since El Salvador’s historic adoption of bitcoin as legal tender, and we are starting to hear stories from the ground.
How is bitcoin adoption going? Well, it’s something a lot of developing economies around the world, including right here in Asia, are no doubt paying close attention.
Forkast.News Lachlan Keller has the story.
El Salvador has seen a rocky start to its first week of having the digital currency, bitcoin, as legal tender.
First country in the world to do so is saw a 15% crash in the bitcoin market just hours after launch, technical problems plaguing the country’s digital wallets and widespread demonstrations against the government and the adoption all taking place within a week’s time.
Alex Shipp, Chief Strategy Officer of a private, decentralized finance platform Offshift was on the ground in El Salvador when BTC became legal currency.
He says that an outsider may think the adoption is going smoothly and that there is a significant uptake across the country. But from what he saw, that’s not the case.
“Almost no one uses bitcoin. Very few people know really what it is. So, yeah, there’s quite a lot to be said.”
Shipp found that most of the bitcoin adoption in the country is occurring in a small coastal town of only about 3,000 people named El Zonte – or as it’s known in the crypto industry, Bitcoin Beach.
Outside of that, even in the country’s capital of San Salvador, finding a bitcoin user isn’t easy he says.
On Wednesday, the nation marked its bicentennial, celebrating 200 years of Central American independence from Spanish rule. Celebrations were marked by more protests against the government, including the decision to adopt bitcoin as a legal currency.
“Part of what’s happened is that the government coming in and enforcing some kind of legal tender law are you doing something more or less authoritarian?”
And that ship says is making a lot of people who don’t really know much about bitcoin turn against it before they’re even educated on it.
For Forkast.News, I’m Lachlan Keller.
And with rumblings of more countries considering making bitcoin and other cryptocurrencies legal tender – all eyes will continue to focus on El Salvador to see how this first in the world test plays out.
And that’s The Daily Forkast from our vantage point right here in Asia. For more visit Forkast.News. I’m Editor-in-Chief Angie Lau. Until next time.