The South Korean government will reportedly enforce new rules banning the use of anonymous cryptocurrency trading accounts from January 20h.
According to Korean news agency Yonhap, the government is turning up its scrutiny on the burgeoning local cryptocurrency market to curb speculative investments in cryptocurrencies. Citing anonymous financial industry sources, the report also points to accompanying guidelines that will mandate exchanges to comply with heightened anti-money laundering norms.
The Korean government announced its intention to implement curbs among the country’s crypto trading market last week after concerns about “high losses due to excessive volatility.”
“Officials share the view that virtual currency trading is overheating irrationally … and we can no longer overlook this abnormal speculative situation,” an excerpt from the government’s statement added.
The new rules will only allow deposits and withdrawals to traders with matching account names at their banks and cryptocurrency exchanges. New anonymous ‘virtual accounts’ will also see a complete ban as a part of the government’s agenda to mandate and strengthen KYC (know-your-customer) rules in the industry.
Such is Korea’s cryptocurrency mania among retail investors, new adopters and everyday citizens that Prime Minister Lee Nak-yon called it a “pathological phenomenon” in late November.
The reported date to ban anonymous trading comes within a month of Korean authorities conducting onsite inspections of multiple cryptocurrency exchanges following the mid-December hack of Seoul-based exchange Youbit.
While Korean authorities haven’t banned cryptocurrency trading outright, one senior government official confirmed regulators will “consider” the shutdown of cryptocurrency exchanges, if necessary, in the future. The suggestion of an outright ban was first proposed by Korea’s Ministry of Justice in early December, although such crippling measures is reportedly certain to meet opposition from other legislators.
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Last modified: May 20, 2020 9:14 PM UTC