In breaking news, the self-regulatory inspection of South Korean Crypto Exchanges has finally been concluded.
Over two months ago, the Korea Blockchain Association (KBA) wanted to initiate self-inspections into Crypto exchanges to insure that the Crypto exchanges operating in South Korea had safeguards to check themselves from potential issues such as cyber-attacks.
The spark that led to the self-inspections of the crypto exchanges by the KBA had influences from the announcements that the Korean Financial Services Commission (FSC) gave to the public about potential new crypto regulatory frameworks. The FSC has stated that it wants to have a strict approach towards trading regulations and user monitoring. The FSC specifically wanted to focus on money laundering prevention and cyber-crime prevention to be the prevalent issues that the exchanges should be focusing on. The potential FSC regulations aimed to provide frameworks that pertains to AML and KYC requirements for the exchanges to follow.
KBA announced that only 12 out of the 23 crypto exchanges gained self-affirmation and met the cyber security standards that Korea has in place. Fourteen Crypto Exchanges were at first willing to go through the inspection, but two withdrew from the inspection during the past months. The list of the crypto exchanges that passed the self-regulatory exchanges were Dexko, Hanbitco, OKCoin Korea, Huobi Korea, Bithumb, Upbit, Neoframe, Gopax, Cpdax, Coinzest, Korbit and Coinone. Two of the crypto exchanges that withdrew from the inspection by the KBA were Sunny7 and Komid.
It is said that the twelve crypto exchanges had tough self-imposed tests to pass. Some of the criteria’s that the exchanges had to meet were having minimum total assets,, adoption of a cold wallet, anti-money laundering requirements, and so on.
The inspection that took place was done by third party experts that were approved by the KBA back in June.
The head of the KBA’s inspection committee, Jhun Ha-Jin, stated during the press conference that there were security flaws found in some of the crypto exchanges that were inspected. However, there was no detailed explanation of what the flaws that were found were. Also, there was no detailed explanation of how well the exchanges met the security standards stated by the KBA.
The international community should notice that these are events we should not ignore because there were a good number of cryptocurrency exchanges that were willing to go under inspection by an outside party such as the KBA and pass security checks/self-regulation checks. It gives assurances to the investors of cryptocurrency and blockchain developers because of the willingness of exchanges to be self-regulatory and are concerned about the people who are utilizing their platforms. Even though the statements from the KBA were of an ambiguous nature, we can see that there are definite changes coming to Korea. We are not too sure yet what to take from this important event except that changes are coming. On top of that, South Korean government officials are now talking about bills on crypto currency and blockchain related issues, which potentially can turn into new laws in a matter of two weeks.
(For more updates on S. Korean Crypto News, follow us on Telegram)