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Global Money Laundering Watchdog Briefed on Korea’s Crypto-Friendly Rules

Last Updated March 4, 2021 5:05 PM
Samburaj Das
Last Updated March 4, 2021 5:05 PM

South Korea’s financial watchdog has reportedly briefed a major global anti-money laundering body of its rules for domestic cryptocurrency transactions.

South Korean authorities, who have notably adopted a friendly stance on non-anonymous cryptocurrency trading in the country this year, have briefed the Financial Action Task Force (FATF) of South Korea’s domestic guidelines for cryptocurrency transactions, Yonhap  reports.

Established in 1989, Paris-based FATF is a global intergovernmental body tasked to combat money laundering and terrorism financing (AML/CTF) with 37-member states  from all six populated continents in the world. In a meeting attended by all members last week, South Korea’s newly implemented AML guidelines for domestic cryptocurrency trading ‘were the first to be drawn up’ during the members’ discussion, the report revealed, citing the Financial Services Commission (FSC).

As Korea’s financial regulator, the FSC enforced a complete ban on anonymous trading of cryptocurrencies to introduce a new ‘real name trading system’ wherein cryptocurrency traders are required to use their real names with their crypto accounts and their bank accounts. In essence, any new cryptocurrency purchases or withdrawals in fiat will require traders and adopters to comply with the new know-your-customer (KYC) rules that kicked in on January 30.

Since then, Korean financial regulators have publicly stated that the government will support ‘normal [non-anonymous] transactions’ of cryptocurrencies, going so far as to call for the ‘normalization’ of cryptocurrencies in the country.

“The whole world is now framing the outline (for cryptocurrency) and therefore (the government) should work more on normalization than increasing regulation,” South Korea’s Financial Supervisory Service (FSS) chief Choe Heung-sik told reporters in a briefing last week.

Those rules are now being briefed to some of the world’s largest countries and economies, in what could ultimately pave the way for wider adoption and trading of cryptocurrencies globally under widely-accepted KYC norms.

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