From January 24, 2022, the South Korean exchange Coinone will block the withdrawal of cryptoassets to external addresses that are not associated with the client’s identity, due to the tightening of regulatory policy.
Coinone
notified users that plans to introduce a new registration and identification procedure, after which traders will not be able to withdraw their cryptoassets to external addresses that have not been verified. These are wallet addresses that do not require the KYC (“know your customer”) procedure to register. From December 30 to January 23, Coinone users will be able to pre-register addresses in order to receive confirmation for the withdrawal of cryptocurrencies.
The exchange said the introduction of the new customer due diligence system is related to compliance with local regulatory requirements. This will ensure that virtual asset transactions or services provided by Coinone are not used for money laundering and other illegal activities, as the exchange will conduct enhanced verification of customer data.
This summer, the South Korean government has already taken measures to combat illegal cryptocurrency activity. In July, the Korea Financial Intelligence Unit (KFIU) ordered foreign exchanges to trade cryptocurrencies offering services to South Korean citizens to register with the regulator and comply with KYC standards, otherwise exchange owners face heavy fines and up to five years in prison. Shortly thereafter, South Korean authorities also offered to confiscate cryptoassets from tax-evading traders.
Due to stricter regulatory requirements, many small cryptocurrency exchanges were forced to stop operating in the country. Few exchanges have entered into agreements with banks to service accounts with mandatory identification of the person, including Coinone.
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