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The Korea Financial Services Commission (FSC) will impose a fine of 100 million won (approximately $ 89,844) on exchange employees caught trading on the platforms they work for. Currently, there is no law prohibiting managers and employees of exchanges from trading cryptos on their own platforms.
According to the FSC, officials from the Korea Financial Intelligence Unit (FIU), which operates under the FSC, met with heads of major Korean crypto exchanges on June 3 to brief them on the updated decree.
South Korea’s updated Financial Transaction Reporting Law (FTRA) requires all crypto exchanges to register with the FIU by September 24, 2021. Registration is not a simple process, however. deposit. Scholarships must meet strict conditions for their registration to be approved. These conditions include acquiring partnerships with commercial banks and approving their anti-money laundering (AML) and know-your-customer (KYC) systems.
All exchanges that are not approved by the deadline will be closed. The FIU also said that registered exchanges whose executives or employees are caught trading on their own platforms after the September deadline will have their registration status revoked.
The major Korean stock exchanges have in fact established company policies that restrict employee trading, but many will be silenced by the new restrictions on FIUs.
Upbit, one of the world’s largest exchanges by volume, currently allows employees to trade on its own platform, but is prohibited from touching any cryptocurrency other than bitcoin (BTC), ether (ETH) or tether (USDT). All company employees are prohibited from buying or trading anything beyond these three cryptocurrencies, regardless of what platform they use.
Additionally, Upbit employees are required to report how much crypto they own and how much they profit from each transaction. There is also an annual limit on how much they can trade, but this limit has not been made public.
Bithumb, another major South Korean player, allows employees to buy and trade new cryptocurrencies only within 72 hours of being listed on the stock exchange. It also prohibits exchanges during working hours. Bithumb also requires all employees to sign a statement stating that they will not use company information and data for personal business purposes.
If this ban were implemented, these exchange employees could still trade cryptocurrencies, but only on other platforms, not their employers.
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