Financial authorities in South Korea have established a period for users to report any unlicensed cryptocurrency exchanges operating within the country.
According to the Dec. 4 update, this latest initiative is a collaborative effort between the Digital Asset Exchange Association (DAXA) and South Korea’s Financial Intelligence Unit (FIU). DAXA encompasses five major virtual asset exchanges in the country: Upbit, Bithumb, Coinone, Korbit, and Gopax.
The primary objective is to identify domestic and foreign virtual asset business operators targeting Korean citizens without complying with article 7 of the Specific Financial Information Act.
The process for handling these reports involves an initial review by DAXA, followed by a detailed examination by the FIU. The FIU will then communicate its findings back to DAXA to determine the operational status of the reported entities and decide on the necessary actions.
An official from DAXA highlighted the seriousness of the situation, stating that if operators persist in conducting undeclared business activities, the FIU will consider taking appropriate measures, which may include involving investigative agencies.
DAXA has provided a dedicated tip email address to facilitate this reporting process. They encourage the public to submit detailed information about the suspicious business, including reasons for suspicion and any evidence of undeclared activities.
This move is part of South Korea’s broader strategy to increase its regulatory oversight in the crypto sector. In a notable development on Nov. 14, the Democratic Party of South Korea required its parliamentary candidates to disclose their crypto holdings, aiming to enhance transparency in political circles.
The South Korean digital asset market has also witnessed significant growth in 2023. As reported earlier in October, the market’s total capitalization reached $21.1 billion in H1 2023. This growth was accompanied by a substantial 82% increase in operating profits for virtual marketplace operators, totaling $168 million.
Meanwhile, on Nov. 23, South Korea’s central bank announced plans to involve 100,000 citizens in testing its upcoming central bank digital currency (CBDC) in 2024.