South Korea Steps Up Inspections

Given the popularity of crypto-currencies in South Korea and following the recent Youbit exchange hack; South Korean regulators have been beefing up their inspection efforts.

More than a dozen bitcoin exchanges have received onsite inspections to determine whether they are compliant with regulations governing cryptocurrency trading.

The inspectors were not pleased by what they found.

“As a result of conducting on-site inspections on the major virtual currency exchanges, most of the surveyed companies (10 companies) conducted administrative and technical security such as installation and operation of access control devices and encryption measures of personal information Overall, the measures were found to be inadequate,” the notice read, according to a rough translation.

This has prompted many cryptocurrency enthusiasts to speculate that South Korea is getting ready to follow China’s lean; and outright ban domestic cryptocurrency exchanges.

Considering the size of the cryptocurrency market in South Korea this would be very damaging for the cryptocurrency market as a whole. But is highly unlikely.

What is happening however; is an increase in regulation to protect the general public from investing in unsafe and unregulated exchanges.

According to a leaked draft, the regulations will restrict unaccredited investors from speculating on cryptocurrencies using Korean trading platforms. And could require exchanges to seek government approval to list new cryptocurrencies.

The cryptocurrencies continue their explosive growth. It is becoming increasingly difficult for the governments to ignore them. We can expect a lot more developments in this area in 2018.