The emergence of K-Pop has put South Korea on a pedestal. Along with this, the country made it clear that it intends to jump on the crypto bandwagon as well. The country went on to recognize cryptocurrencies by levying taxes on them. More recently, the financial regulators of South Korea revealed that they were looking to strengthen the money laundering laws that govern cryptocurrency exchanges.
In a recent announcement made by the country’s Financial Services Commission [FSC], it was noted that cryptocurrency platforms that fail to impanel powerful anti-money laundering laws would have to face the wrath of hefty fines.
South Korea’s Latest Move To Strengthen AML Laws
The financial watchdog in its announcement clarified that any platform that forfeitures these laws post 20 April 2021 would be subject to fines of between 30% all the way up to 60%. FSC further wrote,
“Under the revised regulation, financial institutions and VASPs will be subject to penalties if they are found to be in violation of internal control duties (e.g. failure to report suspicious transaction activities), data maintenance duties (e.g. failure to keep relevant data on suspicious transactions) and duties specifically pertaining to VASPs (e.g. failure to keep separate management of customers’ transactions records).”
Additionally, the fines would largely be based on the size of the respective crypto platform. Smaller fines would be imposed on small crypto exchanges in case of failure to follow AML laws.
The demand for crypto is thriving and countries across the globe have been bolstering their hold on the crypto industry. Despite this, there are many countries that have failed to put in place laws concerning money laundering. Prominent South Korean crypto exchange, Bithumb explained that it was taking the right measures ahead of this newly introduced law.
A local news portal revealed that Bithumb would ban users from countries that have no anti-money laundering processes in place. A Bithumb official reportedly said,
“The company will continue improving its system to protect investors, and enhancing transparency in the crypto market.”