• Bithumb, a cryptocurrency exchange, has received regulatory approval in South Korea

  • The Bithumb exchange in South Korea has been officially registered with the Financial Intelligence Unit (FIU). As a result, the country’s four major exchanges are now authorized to operate virtual assets, including cash-to-crypto services.

    • On November 19, the FIU announced that it had registered Bithumb as an official virtual asset business. The country’s other three major exchanges — Upbit, Coinone, and Korbit — had already been accepted by the FIU, while a decision on Bithumb’s business report had been delayed for 75 days. According to some media reports, this is due to the ongoing trial of Bithumb’s major shareholder Lee Jung-hoon, who was indicted on fraud charges.
    • Heo Back-young, CEO of Bithumb, issued a public statement thanking users and promising to “do our best to focus on introducing cryptocurrencies based on a strict listing process” and that the exchange will “put investor protection as a top priority.”
    • The Financial Services Commission (FSC) established two major requirements for virtual asset businesses to meet on March 25. Exchanges must first obtain an Information Security Management System (ISMS) certification, which demonstrates their ability to protect users’ personal information. Another was securing a partnership agreement with a South Korean local bank to provide crypto exchange users with withdrawal and deposit bank accounts in their real names. This was done to reduce the possibility of crimes like money laundering, embezzlement, or price manipulation.
    • Out of a total of 63 exchanges, only 28 remain operational as a result of the crypto regulations. Only four major exchanges out of the 28 have met both requirements, making them the only ones permitted to provide cash-to-crypto services. The other 24 have obtained the ISMS certification but not the bank contract, limiting them to operating as token-to-token exchanges.
    • On the same day as Bithumb, the FIU accepted business reports from Flybit and GDAC, two of South Korea’s smaller exchanges. However, because they have not secured a bank partnership, they are unable to service cash-to-crypto transactions.
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