|Jan 20, 2018 11:37 PM||By: Guest Author | 8208 Views|
Korbit, the third biggest bitcoin and cryptocurrency exchange in the South Korean market after Bithumb and Coinone, has declared that non-Korean nationals or foreigners will not be permitted to deposit Korean won at any national cryptocurrency exchanges.
In a message sent to its customers, Korbit stated:
“Please note, however, that non-Korean nationals, both resident and non-resident, will not be allowed to deposit KRW at any domestic cryptocurrency exchanges when the new KRW deposit method is implemented. We will explain further via a separate message.”
The Korbit team recorded that the closing of Kookmin Bank virtual bank accounts on the trading platform onward with the cryptocurrency trading prohibition for foreigners is a part of a current anti-money laundering (AML) policy submitted by the South Korean government.
“In order to comply with the identification and anti-money laundering regulations being enforced by the government, the current KRW deposit method will be terminated by the end of January 2018,” said Korbit.
Last month, on December 14, news blog CCN reported that the South Korean government issued four major regulations to properly regulate and foster the local cryptocurrency exchange market. One of the four regulations was to ban underaged investors and foreigners from trading cryptocurrency-to-fiat (KRW) on local trading platforms.
The government report leaked in early December read, “request banks and exchanges to ensure underaged investors and foreigners cannot start trading accounts on cryptocurrency exchanges.”
In December, the South Korean government told that it has decided to ban foreigners from trading cryptocurrencies within the local market to prevent abroad investors from taking advantage of the arbitrage possibility in the local cryptocurrency market.
Since trading prices of maximum cryptocurrencies in the South Korean market are at least 15 percent higher than global standard prices, the government requested both cryptocurrency exchanges and banks to cripple foreigners from trading cryptocurrencies in the regional market.
Originally, local exchanges prepared to ban foreigners from trading cryptocurrencies by January 20. But, based on the report of Korbit, foreigners will be able to trade until January 31 and by the end of this month, abroad investors will no longer be able to deposit Korean won on South Korean cryptocurrency trading platforms.
Last week, the South Korean government and the administrative office of President Moon Jae-in officially said that a cryptocurrency trading ban would not be required in the short-term. First then a ban, the government emphasized that strict regulations will be required to ensure the local cryptocurrency exchange market remained stable and regulated for general customers.
Following the statement of the government, South Korea’s Fair Trade Commission chairman Kim Sang-jo stated that closing down cryptocurrency exchanges is realistically difficult, considering the tremendous economic impact it would bring.
The statement of chairman Kim translated at CCN read:
“[Shutting down cryptocurrency exchanges] is not realistically possible. Based on electronic commerce law, the government does not have the power to close down cryptocurrency trading platforms.
From the viewpoint of an economist, it is not a fair and transparent decision to completely ban the economic activity. Whether it is unnecessary speculation or not, the gain or the loss is the responsibility of the investor.”
As of current, it continues unclear whether foreigners will be ban from trading cryptocurrencies in the local market in the long run.