OKEx announced that it will stop operating in South Korea following stringent anti-money laundering regulations.
OKEx is shutting down in the country in the wake of new AML regulations. The exchange announced its exit on its website. It will stop operating in South Korea on April 7, 2021.
The exchange requested that all customers close their positions and withdraw balances before the date.
They had stopped KRW transactions before this announcement. They also eased withdrawal limitations for users. A notice from OKEx read:
“According to the Special Financial Information Act (Special Law) passed at the National Assembly plenary session, we will temporarily terminate the KRW market service in order to systematically prepare the obligations of the cryptocurrency exchange.”
The company shut down in the country because of the new policies. It is the first exchange to react in this manner, and it remains uncertain if others follow suit.
South Korea Implements Stiff AML Rules On VASPs
South Korea’s Financial Service Commission (FSC) laid out new regulations for Virtual Asset Service Providers (VASPs) last month.
A new press release from the FSC states that the new regulations will take effect on March 25, 2021.
According to the regulations, VASPs, including cryptocurrencies operating in the country, must verify customer identities. Part of the law mandates them to report suspicious transactions to Korea Financial Intelligence Unit (KoFIU). This must be done within three days.
Korean authorities will run periodic checks on VASPs to ensure compliance with the AML regulation.
The country has intensified efforts to legitimize the cryptocurrency industry lately. It prepares to levy taxes on bitcoin capital gains from next year.