April 23, 2021 12:12
Financial Services Commission Chairman Eun Sung-soo on Thursday warned that hundreds of cryptocurrency exchanges face closure in the government's crackdown on the booming trade.
"There are 200 cryptocurrency exchanges in Korea, but they can all be shut down," Eun told the National Assembly in a policy hearing. "They could be suddenly closed down in September."
"We are accepting registrations" under relevant new laws, "but no company has registered so far."
The new laws compel exchanges to ensure that investors trade cryptocurrency only via real-name bank accounts from September, and if they fail to comply they can have their business suspended. The aim is to prevent money laundering and other criminal activity.
The cryptocurrency market is chaotic and overheated, with one new cryptocurrency surging 100,000 percent during the first 30 minutes of trading. Financial authorities fear the fallout could be devastating since more than half of cryptocurrency investors here are in their 20s and 30s.
When a lawmaker complained that protections are insufficient, Eun said, "The government can protect them only once they are classified as financial investors. The government cannot protect everything."
The government does not recognize cyber money as a financial product under existing regulations. "I'm afraid the craze will only escalate if the cryptocurrency market is officially recognized," Eun said.
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