If there is no Korean Won market that trades legal currency and virtual assets (cryptocurrency), it is possible to operate a cryptocurrency exchange without issuing a’real name confirmation deposit/withdrawal account’ (real name account). Also, sharing of’order books’ is limited.
The Financial Services Commission and the Financial Supervisory Service enacted on the 17th amendment to the supervisory regulations to specifically determine the matters entrusted by the supervisory regulations ahead of the enforcement of the amendment to the Act on the Use and Reporting of Specific Financial Transaction Information (Special Act) on March 25th. He announced.
The main contents of the amendment to the supervisory regulations released today included △method for calculating cryptocurrency prices △reason for real-name account exceptions △limited order book permission △prohibition of handling dark coins △defining when to report suspicious transactions (STR).
Exchange operation without a real name account
Among them, the’reason for real-name account exception’ was a subject of interest as a problem directly related to the survival of domestic cryptocurrency exchanges. Currently, only four domestic exchanges have real-name accounts: Upbit, Bithumb, Coinone, and Kobit.
Cryptocurrency exchanges, which belong to Virtual Asset Business Operators (VASP) under the Special Fund Act, can only be operated after receiving a report from the Financial Information Analysis Agency (FIU). In particular, since the obligation to secure a real name account was included in the reporting and repair requirements, exchanges that did not receive a real name account from the bank were forced to close.
For this reason, the possibility of “spoiling” small and medium-sized exchanges without real-name accounts was raised in the blockchain industry after the enforcement of the special money law. However, as the amendment to the supervisory regulations stipulates the reason for the exception of the obligation to secure a real name account, the way to continue the business of the exchange has been opened without a real name account.
According to the amendment to the supervisory regulation, it was stipulated as a’virtual asset business operator who does not have the act of exchanging money with virtual assets’ as an exception to not having to obtain a real name account. In other words, in the case of an exchange that does not have a’won currency market’ that trades cryptocurrency in legal currency, it is possible to report and repair a virtual asset business operator without a real name account.
Limited order book sharing allowed
The Financial Services Commission limitedly allowed different cryptocurrency exchanges to share order books. So far, small and medium-sized exchanges, which lack cryptocurrency trading volume, have provided liquidity by linking the order book of large exchanges. However, due to rumors that the special laws to be enforced will not allow this, many exchanges have recently stopped sharing order books.
As the amendment to the supervisory regulation permits order book sharing, it is expected that small and medium-sized exchanges will be breathless. However, in order to share the order book, it is possible only if certain requirements are met.
The key is the anti-money laundering (AML) obligation. Virtual asset business owners that share order books must obtain licenses at home or abroad and fulfill their AML obligations. In addition, customer identification (KYC) must be possible for each other’s customers.
The contents of Dark Coin were also included in the revision of this supervisory regulation. With the enforcement of the Special Money Act, privacy coins (dark coins) such as Monero, Dash, and Zcash in Korea cannot be traded. The Financial Services Commission said through the amendment to the supervisory regulation, “Darkcoin is prohibited because it is difficult to understand the transaction details and the risk of money laundering is high.”
In addition, details on the timing of implementation of the anti-money laundering obligations (reporting, customer verification, suspicious transaction reporting, etc.) were also disclosed. Since the Act on Special Funds stipulates the implementation of the obligation to prevent money laundering, there has been confusion among exchanges regarding the collection of identification information such as resident registration numbers of customers.
An official from the Financial Services Commission said, “Under the Special Money Act, the obligation to prevent money laundering must be fulfilled with the enforcement of March 25, but we considered the fact that it is difficult to implement prior to the acceptance of the report.” “You just have to fulfill your obligations.”
On the other hand, the administrative notice of some amendments to the Special Act is made from February 18 to March 2, and if you have opinions, you can submit them to the Financial Information Analysis Institute ([email protected]).
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