24 Virtual Asset Operators Fail to Apply for ISMS Certification, Facing 'Closure Risk'..."Concerns Over User Damage"

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Ji-hwan Park] Among 63 virtual asset operators, 24 have not applied for the Information Security Management System (ISMS) certification, which is the minimum requirement for business registration. According to the Enforcement of the Act on Reporting and Using Specified Financial Transaction Information, companies that fail to obtain certification by the 24th of next month must shut down. These companies are effectively unlikely to acquire certification before the business registration deadline of the 24th of next month, raising concerns about potential harm to users.

According to the list of virtual asset operators by registration preparation status released by the government on the 25th, a total of 21 operators had obtained ISMS certification as of the end of July. Currently, 18 operators have applied, while 24 have not applied at all. Exchanges that have not applied include DOCOIN, BananaTalk, Bitnia, and BitChain.

The ISMS certification is a process conducted by the Korea Internet & Security Agency (KISA) to verify whether the administrative, technical, and physical protection measures of an information system meet the standards. Typically, it takes 3 to 6 months to obtain ISMS certification after application. It is expected that companies that have not yet applied will find it practically impossible to obtain certification before the business registration deadline of the 24th of next month.

The financial authorities stated, "Under the Act on Reporting and Using Specified Financial Transaction Information, virtual asset operators who do not report to the Financial Intelligence Unit by the 24th of next month must close or suspend their operations," adding, "Users who transact with virtual asset operators that have not applied for ISMS certification are at risk of damage due to closures or suspensions."

The government emphasized the need to take preemptive measures, such as withdrawing deposits and virtual assets in advance if necessary. They recommended that if cases of refusal or delay in withdrawal requests for deposits or virtual assets, or sudden business suspensions occur, users should immediately report to the Financial Intelligence Unit, Financial Supervisory Service, or the police.

A financial authority official stated, "Even for virtual asset operators who have reported to the Financial Intelligence Unit, if they have not secured real-name verified deposit and withdrawal accounts, exchange transactions between virtual assets and money will not be allowed, so special caution is advised."

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