South Korea Take Measures on Bitcoin with China and Japan
The Financial Services Commission (FSC) informed on Monday that the authorities of China and Japan will cooperate with Koreas financial regulator to curb speculation using digital tokens.
FSC Chairman Choi Jong-ku said the three nations have discussed how to regulate cryptocurrencies. He showed his concern about recent bitcoin craze among Koreans.
“After inspection of cryptocurrency accounts, we’ve decided to impose new regulations to deal with anonymous accounts and possible money laundering,” he said.
Choi said, that Korea lacks information on the things that happen in the crypto market because of not existing direct rules on virtual money trading.
The top financial regulator is set to carry out a joint in-depth inspection of six leading local banks that provide virtual currency accounts to investors.
Among the 6 local banks are the Industrial Bank of Korea Nonghyup, Shinhan, Kookmin and Woori banks, and the Korea Development Bank. Shinhan, Kookmin and Woori are among the country’s top four lenders alongside KEB Hana.
There are concerns along anonymous cryptocurrency transactions and for that reason the FSC asked local banks to implement “know-your-customer” rules, which is a time-honored principle in the financial sector.
At the same time those investors, who have active accounts on cryptocurrency exchanges have to link their accounts with a separate bank account.
As Choi pointed, they will pay extra attention on that banks set protective measures for traders who involved in crypto space.
If banks fail to comply with the guidelines, he noted they will be forced to shut down their digital token accounts.
He said that the country’s justice ministry and tax agency will team up with the regulator for setting legal base, which will allow to record cryptocurrency exchange operators by the regulator.
“We aim to track where the money for cryptocurrency deals came from,” he said.
The regulator also pledged to take steps to toughen punishment against crimes involving cryptocurrency transactions. More than 2 million Koreans are known to own bitcoins.
It will be clear if such measures shows effectiveness. But analysts say, if there will be a result, it will be short lived.