The South Korean division of cryptocurrency exchange OKEx is shutting down due to the entry into force of new AML rules for cryptocurrency service providers this week.
April 7 is the last day on which users can withdraw their crypto assets and fiat currencies from the exchange, according to a statement on the website of the OKEx South Korea branch. Then the site stops working in South Korea. According to the company’s spokesman, it will become too difficult to work in the local currency market due to the new AML rules for cryptocurrency companies.
“In addition to several other factors, the actual profit from our operations in Korea is small, so we decided to cut our losses,” said a spokesman for the exchange.
Under the revised Financial Transaction Reporting Law, cryptocurrency service providers must pass regulatory checks and identify customers. The regulation comes into effect on March 25th.
The new law also stipulates that cryptocurrency service providers are required to file suspicious transaction reports with the Korea Financial Intelligence Unit and are accountable to the Financial Services Commission (FCS). Cryptocurrency companies will be given a six-month grace period to bring their work in line with the new rules.
“Until now, we have provided most of our services in cooperation with banks, but maintaining a banking partnership without complying with the new rules is now impossible,” said an OKEx spokesman.
The implementation of the new rules in South Korea is in line with the FATF guidelines, which oblige cryptocurrency exchanges to exchange customer information.
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