Topic: New regulation in South Korea has forced several exchanges to close - page 2. (Read 393 times)

I guess they could use the peer-to-peer exchanges/wallets to make to conversions. There are several of them but I hope they can use the decentralized ones more.
They could have their funds in Bitcoin or in one of the main stablecoins then gradually convert their them to national currency when they need to spend them.

Does anyone have a list of the Exchanges that are located in South Korea?

20% is a very high percentage. With that figure, I think the Korean government should provide proper facilities and guarantees to those investors. I see the level of crypto crime cases in Korea is quite high.

This will be a rights war between 2 business entities, on the one hand the Korean government pressures the exchanges to get the customer's original identity rights through their bank partners, while the banking institutions ask to release the bank's responsibility for crypto crime cases.
https://news.bitcoin.com/korean-banks-to-be-relieved-of-liability-for-crypto-related-crime-report-suggests/

New York had something like this back in the day. There were a lot of companies who were interested in moving to New York because financial world is there, wall street is one of the biggest financial hearts of the world, what they do there in wall street could impact the economies of whole nations. So crypto companies wanted to be there, Coinbase would have a huge headquarters right in the middle of wall street if the laws were not like that.

However, one day there was an idiot called Benjamin Lawsky who wanted to create something called Bitlicense to make sure regulations on crypto was harsher, and when he stopped working for his job, he became a consultant for companies who wanted to get bitlicense, so basically, he created his own retirement plan based on crypto in New York. Now many companies run away from New York, even if founded there, they go to delaware which has a lot more lax laws.

It’s gonna be difficult if we live in South Korea right now as crypto enthusiasts. 20% tariff is very painful in our pockets when the crypto capital gains tax is going to be in effect. But for P2P trading, I think this is the safe haven but there are limits on how many buyers and sellers are there in South Korean who are doing P2P. There’s no doubt that US will be imposing stricter measures for the crypto industry as well. In the Philippines, I think they classify crypto as luxury tax (correct me if I’m wrong though).

Because it's easier for the law to trace those payments if they want to, all the cashflow will be done through 1-2 banks and not spread across the entire system with exchanges making payments out of 100 accounts to 100 banks, probably a lot of times even for the same exchange user to different bank accounts.
Putting another player in this mess would simply give them more headaches and they don't want any whatsoever.


Nope, it's not normal and their FSA should track the source of all this at an individual level, but you see that nobody is that keen on doing that much work. Exchanges want to minimize their responsibilities by only checking names on an id and on bank statements, banks don't want to be just the gateway for people who are not their regular clients with credit cards/loans all that stuff,  and the state is lazy as usual.



If they will deal with South Koreans wons, and they accept it as a currency or use it as a pair they will be forced to seek a license.
But, the opposite is happening: Bithumb to ban foreigners without mobile phone identification

Hopefully, that will not impact bitcoin price globally or if that impacts the price, it will not have a big impact. But maybe this situation is related to that news since the bitcoin price now is down a lot. I wonder what those people will do if many exchanges have been forced to close their businesses. But I think those people will trying to search for the other exchanges and use that exchanges to continue trading. But I think those exchanges will not want to close their exchange and will try to fill the requirement from the government to run their business.

While banks were in the law for handling the money, now they're there to prove ownership of accounts / enforce KYC.
In my brain these are different things. It's only the banks who can do such checks? I guess not. And if so, why are the partnership enforced with banks and not any kind of company that can do such tasks? And what if the business can create its own department for handling this? Sorry, I may be missing something, but for me this enforced partnership is not normal.


Indeed. And it's becoming harder to harder to keep the business running while it's on the run. After the Binance experience it's to be expected that the countries will only get better in avoiding/banning this kind of practices.

I wonder if this affects S. Koreans who use foreign exchanges,... if not, I guess rather than closing down, the exchangea should seek for licenses to operate in other countries, then the people from the country could continue with them..
I couldn't access the article in order to properly understand the issues/demands.

The lawyers will not do be able to do a thing, it's just like here in the EU, every business must have a  bank account for operations, same will be applied here, with the small difference that they will not permit any more deposits and withdrawals from other accounts with a punishment this time, not just tax evasion (if proven).
It was common practice for exchanges to operate with personal accounts in order to hide cashflows and avoid taxation, now they if they try this is going to hurt them a lot.

That's below the average monthly wage for Korea,  I think this might fit the first tax bracket for them, I'm not familiar with their tax system but this might be the minimum value for zero tax earnings.
So no, it's not by any means aimed at taxing the "rich", it will end up taxing almost everyone who makes a profit.


then Japan, then Malta, and so on and on, and even he had no choice but to actually remove all the Korean won pair and even the Korean language from Binance.

That's exactly the reason for that, the banks have political friends and they want to protect their interest as much as they can even if they have to pay or bribe these politician friends. It's not yet the end for the crypto scene in South Korea though, they will still find ways to make things in their favor despite being against the odds with the government itself.

To be candid, I do not know much about how capital gain tax is calculated accurately which could also be differ from country to country. Only what I read about it few months ago is that it is deducted from the profit made either while converting crypto asset to another crypto asset or the profit made while converting crypto asset to fiat. That was the reason I implied the rich people would be the ones that will likely be in the category and also people that are lucky during volatile price trends that favour holding or the position opened. If it is calculated annually, even the average people will also most fall in the category of people that will be taxed, but if calculated on position opened in each trade, maybe the rich will fall more into the category. I may not be absolutely correct.

Yes, they are exchanges based in South Korea, but maybe they can just follow what CZ did to Binance, CZ got not option again than to leave China, but those exchanges are very small exchanges in trading volume, the first four exchanges have over 90% or even over 95% of the total trading volume, so this could be hard for small exchanges to follow.

According to what I read from the news, the banks are not ready to partner with small exchanges, if the banks did not partner with them, likely they will close up as you commented.

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All I can see now is how cryptocurrencies are getting more centralized while it is normally not centralized in design, but if not using exchanges for trading, holders can hold on noncustododial wallets.

A lot of things happening in crypto just today from the fud Binance server to scary South Korea crypto regulation. Crypto Capital gain tax is not going to attract more investors in crypto, this is a crackdown on investors and crypto businesses as well that is why they are making sure the names in cryptocurrency exchanges match the bank accounts.

Anything that is related to finance and trading is strongly regulated and these regulations vary a lot between countries. Believe or not, insider trading is allowed in Russia for example, but, in theory, the SEC throws people in jail for it.



You are not missing anything I think, there are just 4 exchanges of the possible tens existing. You do not have to be rich to make 2k in profits. Most traders make that in profit, before losing it after of course

I read and reread this article and I confess that I cannot understand why the Korean regulator requires exchanges to have partnerships with banks and at the same time empowers banks to reject or not partner with exchanges, we all know that the owners of banks are people from the political parties that most of the time govern the country and if the government is not liking cryptocurrencies, the banks will also not like cryptocurrencies because the banks follow what the government says or opines. i think this south korean behavior is typical behavior of someone who doesn't want cryptocurrencies in their country

It looks like the wind is blowing against cryptocurrency. The regulators in countries around the world are finally realizing that massive amounts of money is being made and moved among these exchanges. For any real long term buyer, it should actually be a good thing because you'll be able to build up your holdings as the price comes down. We saw a few months ago a flash crash happened when there was just a rumor of the US banking regulator taking action and Europe is likely to be even more strict. Considering Bitcoin has only been around and popular for less than 10 years, there is still many more laws to be written around it and politicians are always looking for easy fund raising targets - what better than a currency bought by younger generations who are less likely to vote anyway.

The tax rate is almost the same for stock trades.


Source : Here

I think that this is one of the way for the South Korea Government to discourage crypto trading in their country considering that there is 11 bilion usd worth of transaction in upbit alone so yeah they will try to milk as much as they can from traders. Expected move from goverments though, if they cant do anything to crypto then applying hefty tax rates should do the job

The above is an excerpt from the link in the op, and it's basically clear that Governments will continue to impose regulations, sanctions and bans under the pretext of attempting to challenge and quell crypto scams, when actually they are trying their possible best to have some sort of control over the network and limit its growth which is proving futile, the thing is, I expect this regulations to continue and it's very comfortable for the government to have some sort of control over crypto through centralized exchanges, as the exchange holds possession of users info/data.

Imo, this could be a calculated move to make life difficult for crypto exchanges, and by extension its users, to prolly kick some of them out of business or without choice force them to bend to their new rules, I mean, it's not like fiat crimes and scams have been replaced with crypto scams but the government is making it feel that way; I really do not have high hopes that governments in time to come will be receptive to dex crypto, it's clear they are obsessed with control and want to smother any form of freedom of funds their citizens can get.

Is this thread appropriate in the altcoin discussion section?
I hope the current price decline is not affected by the South Korean policy. Maybe they've always made pretty authoritarian rules. But previously the South Korean government had funded their military from the proceeds of Crypto theft which was funded by the government there. They just take the opportunity in adversity.

$2135 isn't really that much money for a lot of crypto traders, especially over the course of a year (which is what I assume the language of the regulation means).  So that tariff doesn't target only wealthy crypto investors/traders at all--and I think it's ridiculous, even though 20% is probably lower than capital gains taxes on stock trades (though I don't know that for sure).  Governments are constantly trying to figure out how many pockets you have so that they can stick their octopus hands in all of them.

Is SouthXchange based in S. Korea?  I'm pretty sure it is, and I wonder if they're going to comply with these regs or if they're going to close up shop.