South Korean authorities have banned multiple foreign unregistered crypto exchanges in the country. The Financial Intelligence Unit (FIU) has taken a firm stance and banned Poloneix, MEXC, KuCoin, Bitrue, and 13 other exchanges from Google Play. This action was taken in an effort to regulate the crypto industry in the country and protect the South Korean population against the risks associated with such unregistered platforms.

Announced in a PR released on 26^th March, the Financial Intelligence Unit announced that Google has started the operation to restrict the access of the general public to these applications as these are “unregistered operations targeting Korean users.” As a result of this strong stance, Koreans can no longer download or access these applications. Those people who have already installed these applications will not receive any future updates, as per the FIU.

Why South Korea is Banning Unregistered Exchanges

As part of South Korea’s crypto rules, it is mandatory for all foreign organizations, platforms, and crypto exchanges to first register with the authorities before starting their operations in the country. The Financial Intelligence Unit states that only those foreign exchanges will be considered if they support payment in Korean Won, conduct marketing efforts targeting Korean users, or have a website in the Korean language.

The Financial Intelligence Unit insists that banned unregistered platforms pose a high security risk to Koreans, such as hacking threats, money laundering, and data breaches. As these exchanges work outside of South Korea’s regulatory framework, the funds and assets of the users are not protected.

The FIU believes that by banning these platforms, they can “help prevent user damage and curb money laundering through virtual assets.” The FIU is also urging the Korea Communications Standards Commission and Apple Korea to apply restrictions to these exchanges from the App Store and websites.

Similar Actions in Japan

Earlier this year, Japan took similar actions against unregistered exchanges. In February of this year, Apple removed multiple crypto exchanges from the Japanese App Store after being prompted by the Japanese authorities. Users in Japan can no longer access mobile applications for exchanges such as KuCoin, Bitget, Bybit, LBank, and MEXC. All of these exchanges were warned by Japan’s Financial Services Agency for operating without registration.

Future of Crypto Regulations in South Korea

South Korea continues to strengthen its crypto regulations, and the recent actions show their commitment to protecting the general public. By ensuring compliance with local regulations and engaging in ongoing discussions to extend these restrictions to other platforms and websites, it is evident that the country is committed to creating a more secure and transparent cryptocurrency environment.

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