According to Cryptoslate, citing news1, South Korea’s Financial Services Commission (FSC) has reported 16 foreign crypto exchanges to investigative agencies for breaching the Specific Financial Information Act of the country
According to the report, the 16 companies have allegedly been offering crypto services to Koreans and hosting events for Koreans despite the fact that the law prohibits unregistered cryptocurrency exchanges from operating without a license. Among the exchanges affected are Pionex DigiFinex, Poloniex, AAX, ZoomEX, MEXC, KuCoin, CoinEX, and Bitglobal, according to Cryptoslate.
According to the report, the FSC’s Financial Information Analysis Institute division identified the violation.
According to the official website of Oasis, it is a platform that enables users of decentralized finance to borrow, multiply their exposure to cryptocurrency, and earn on their assets.
The FSC seeks to stop these exchanges from conducting business inside its borders. It has asked that the Broadcast and Communications Commission and the Korea Communications Commission make their websites inaccessible from within the country.
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In the meantime, the regulator intends to prohibit credit card companies from providing their services to these businesses.
Officials also chastised crypto exchanges for lacking the information Security management system (ISMS) certificate, putting users at risk of having their personal information stolen.
Individuals can use the exchanges to launder money, according to the officials. A person who operates an unlicensed and illegal exchange faces a maximum 5-year prison sentence or a fine of 50 million won ($37,900) under the Act.
South Korea has one of the most comprehensive legal frameworks for the cryptocurrency industry. When the government mandated that cryptocurrency businesses obtain ISMS certification by 2021, many cryptocurrency exchanges left the country.
Although 35 virtual asset providers have registered in the country, only five exchanges – UpBit, Coinone, Gopax, Korbit, and Bithumb – control more than 99% of the country’s cryptocurrency trades. Meanwhile, as a result of the recent collapse of the Terra ecosystem, there is now a greater emphasis on crypto regulation in the country.
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