Korean cryptocurrency investors and adopters who refuse to include their real names into their anonymous virtual trading accounts will be fined, financial authorities have reportedly said.
Korea’s clampdown on anonymous cryptocurrency trading continues as authorities weigh up fines for adopters refusing to divulge their real identities.
According to Korean news resource Yonhap, Korean financial officials said on Sunday that cryptocurrency investors will have until the month’s end to convert their virtual trading accounts into identifiable accounts with their real names matching their bank account’s information. While the penalties are yet to be determined, violators will be fined for refusing to comply with the rules.
Citizens who flouted similar rules upon the introduction of Korea’s real-name financial transaction system in 1993 faced fines up to a staggering 60% of their financial assets, the report revealed.
As reported in late December, Korean authorities first set upon enforcing a ban on anonymous trading of cryptocurrencies like bitcoin as a means to crack down on financial fraud, tax evasion and money laundering.
At the time, a government statement read:
“We will…resolutely respond to such crimes by slapping maximum sentences possible on offenders. While unconfirmed, there are rumors that new rules banning the use of anonymous cryptocurrency trading accounts will kick in on Saturday, January 20th.”
Under the revised guidelines, new anonymous virtual accounts will be completely banned. Further, domestic cryptocurrency exchanges will see a mandate to only process deposits and withdrawals to traders with matching account names at their banks and exchanges.
Korea’s financial watchdog has already been looking into bank accounts related to cryptocurrency exchanges at six of South Korea’s biggest banks. A total of 111 bank accounts related to cryptocurrency exchanges are under the scanner, worth an estimated 2 trillion won ($1.8 billion) in combined deposits. Each of those accounts, in turn, is believed to have been linked to millions of anonymous virtual accounts.
The Yonhap report also adds that a number of financial authorities and agencies are urging their staffers to stay away from investing in cryptocurrencies. The Korea Exchange, operator of the country’s domestic stock market, reportedly told all employees to abstain from cryptocurrency trading via a text message on Friday.
Elsewhere, the Bank of Korea (the country’s central bank), the Financial Supervisory Service (the financial watchdog) and the Fair Trade Commission (the regulator for economic competition), have all banned their employees from trading cryptocurrencies during work hours, urging them to trade during their off-duty hours instead.
Despite sweeping concerns of a ban on domestic cryptocurrency exchanges, proposed by Korea’s justice ministry, the Korean government quashed such fears today while confirming wider regulatory moves for the local cryptocurrency ecosystem.
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Last modified: May 20, 2020 9:10 PM