South Korea is broadening a prohibition on digital asset companies’ applications serving its citizens. On April 11, the nation’s Financial Services Commission (FSC) disclosed that 14 cryptocurrency exchanges were restricted on the Apple store. Included in the impacted exchanges are KuCoin and MEXC.
The announcement, which became public on April 14, indicates that the prohibited exchanges were reportedly functioning as unregistered foreign virtual asset operators. The announcement also mentions that the Financial Information Analysis Institution (FIU) will persist in advancing the prohibition of the apps and online sites of such operators to avert money laundering and harm to users.
The demand to ban applications on the Apple Store follows Google Play’s blocking access to multiple unregistered exchanges on March 26. KuCoin and MEXC were also affected during the restriction of the Google Play apps. The FSC released a roster of 22 unregistered platforms operating within the country, with 17 of them already barred from Google’s marketplace.
The 17 cryptocurrency exchanges barred on Google Play. Source: FSC
As per the FSC report, users will be unable to download the apps from the Apple Store, and existing users will not have the ability to update the apps. The FSC emphasizes that “unreported business activities constitute criminal offenses” with potential sentences of up to five years in prison and fines reaching 50 million won ($35,200).
FIU examines sanctions against unregistered VASPs
On March 21, South Korean outlet Hankyung reported that the FIU and the FSC were evaluating penalties against crypto exchanges operating in the nation without the necessary registration with local authorities. The sanctions included restricting access to the companies’ applications.
In South Korea, providers of crypto sales, brokerage, management, and storage must report to the FIU. Noncompliance with registration and reporting obligations may lead to penalties and punitive measures.
Related: South Korea reports first crypto ‘pump and dump’ case under new law
The recent sanctions arrive as cryptocurrency is approaching a “saturation point” in South Korea. As of March 31, the number of crypto exchange users in the country exceeded 16 million — making up more than 30% of the populace. Industry experts forecast that this figure could rise beyond 20 million by the close of 2025.
More than 20% of South Korean public officials own cryptocurrencies, with the total value reaching $9.8 million on March 27. The assets varied and included Bitcoin (BTC), Ether (ETH), XRP (XRP), and Dogecoin (DOGE).
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