Exchange Sequentially Delists Coins... Legislative Notice for Amendment to the Enforcement Decree of the Special Financial Transactions Act

Cleaning Up Junk Coins and Removing Coins Directly or Indirectly Related to Exchanges

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Park Sun-mi] Following the government's coin market management policy announcement and the legislative notice of the amendment to the Special Financial Transactions Information Act (Special Act) enforcement decree, the market expulsion of poor-quality coins and coins directly or indirectly related to exchanges is continuing in virtual currency exchanges.

The Financial Services Commission (FSC) has issued a legislative notice for the amendment to the Special Act enforcement decree until the 26th of next month. The amendment includes measures to prevent virtual currency exchanges from issuing so-called proprietary coins for 'self-listing' or mediating trading and exchange. Exchanges will no longer be able to handle virtual currencies issued by themselves or their special related parties, and the exchanges and their executives and employees will be prohibited from trading through those exchanges.

Special related parties mentioned here include ▲spouses in de facto marital relationships ▲blood relatives within six degrees ▲relatives within four degrees ▲corporations or organizations where the individual alone or together with special related parties holds 30% or more of shares or exercises de facto influence over major management matters, including their directors, executive officers, and auditors. These measures address issues arising from the possibility of 'self-listing' of coins by virtual currency exchanges, where illegal activities such as price manipulation occur through false entries using proprietary networks.

The FSC plans to complete the amendment to the enforcement decree by the 27th of next month after legislative notice and consultations with related ministries.

With just over three months left until September 24, the deadline for virtual currency exchanges to complete business registration with the Financial Intelligence Unit (FIU), financial authorities are strengthening regulations on virtual currencies across the board, accelerating the coin cleanup efforts by exchanges.

Upbit, the largest domestic virtual currency exchange, removed five coins including Maro, linked to special related parties, from the KRW market pairs on the 11th and designated 25 coins as investment caution items. Then, on the previous day, it announced the delisting of 24 coins due to failure to meet trading support criteria. This is the largest scale of delisting ever decided at once within Upbit, and these coins will be finally delisted at 12:00 on the 28th.

On the 15th, Coinbit exchange announced it would terminate trading support for eight cryptocurrencies as of the 23rd, and Bithumb also announced on the morning of the 17th that it would end trading support for four coins that did not meet listing maintenance criteria. Huobi Korea and Gdac also decided to delist coins named after their exchanges, such as Huobi Token and Gdac Token.

This content was produced with the assistance of AI translation services.