Upbit, the largest cryptocurrency exchange in South Korea, faces a fine of tens of billions of dollars. What exactly is he accused of?
Upbit accused of accepting non-compliant KYCs
According to the South Korean business daily Maeil Business Newspaper, the cryptocurrency exchange platform Upbit would have accepted between 500,000 and 600,000 Know Your Customer (KYC) procedures even though the latter were not compliant.
Among the examples identified are accounts opened using unclear or incomplete identity documents, making it impossible to reliably identify users.
Upbit said it could not comment on ongoing investigations, citing confidentiality clauses under South Korea's specific financial transactions law.
However, the implications for the business are significant: In addition to potential financial penalties of up to $71,380 per fraudulent KYC, Upbit risks a delay or even non-renewal in obtaining its license..
🏦 Find our selection of the best platforms for buying crypto
Indeed, in South Korea, centralized cryptocurrency exchange (CEX) platforms must obtain a renewable operating license every 3 years, in accordance with the law on specific financial transactions.
This process ensures that exchanges meet strict anti-money laundering (AML) and anti-terrorism financing (CTF) standards, including through rigorous KYC procedures. It is precisely on this point that Upbit was caught during an inspection by the regulator.
Open an account on N26, the crypto-friendly bank
New blow for the South Korean crypto exchange
This news is a hard blow for Upbit, which is already under the microscope of the South Korean authorities. Last month, the president of the FSC pointed out the exchange monopoly in South Korea, which poses a critical risk to its partner K Bank, the largest online bank in the country.
Indeed, according to local regulations, crypto exchanges must maintain their users' deposits with banks. However, Upbit now accounts for more than 20% of deposits at K Bank, and the authorities fear that a rift between the two entities would cause a bank run.
📰 Read on — Binance Launchpool: How to participate to win USUAL tokens?
According to data from CoinMarketCap, Upbit is the 5th largest cryptocurrency exchange in the world in terms of volume traded. Over the last 24 hours, more than $7.7 billion in cryptos have been exchanged on the platform.
The investigation is therefore continuing its course concerning the accusations relating to fraudulent KYC on Bybit, which risks, in the worst case, more than 42 billion dollars in fines.
Ledger: the best solution to protect your cryptocurrencies 🔒
Source: Email Business Newspaper
The #1 Crypto Newsletter 🍞
Receive a summary of crypto news every day by email 👌
What you need to know about affiliate links. This page may feature investment-related assets, products or services. Some links in this article may be affiliated. This means that if you buy a product or register on a site from this article, our partner pays us a commission. This allows us to continue to offer you original and useful content. There is no harm to you and you can even get a bonus using our links.
Investments in cryptocurrencies are risky. Cryptoast is not responsible for the quality of the products or services presented on this page and cannot be held responsible, directly or indirectly, for any damage or loss caused following the use of a good or service highlighted in this article. Investments related to crypto-assets are risky by nature, readers should do their own research before taking any action and only invest within the limits of their financial capabilities. This article does not constitute investment advice.
AMF recommendations. There is no guaranteed high return, a product with high return potential involves high risk. This risk-taking must be in line with your project, your investment horizon and your capacity to lose part of this savings. Do not invest if you are not prepared to lose all or part of your capital.
To go further, read our Financial Situation, Media Transparency and Legal Notices pages.
As Editor-in-Chief of Cryptoast, I am committed to making the world of cryptocurrencies and Web3 accessible to everyone. An expert in identifying the most relevant news, I attach great importance to the quality of the articles produced by Cryptoast. I ensure that our readers benefit from reliable, verified information presented in a clear and easy-to-read manner. My goal is to share quality knowledge to better inform and educate our audience about this constantly evolving world.
Maximilien Prue
1309 items
