Key Takeaways
- Crypto.com has postponed its South Korean launch due to regulatory concerns over its anti-money laundering practices, following an emergency inspection by South Korean authorities;
- The exchange, which had acquired a local crypto platform to secure a VASP license, is now working closely with regulators to clarify its AML measures;
- South Korea is enhancing its crypto regulations.
Due to regulatory issues concerning its anti-money laundering (AML) protocols, Crypto.com, a cryptocurrency exchange based in Singapore, has postponed its expansion into South Korea.
The delay came after the South Korean Financial Services Commission (FSC) identified discrepancies in the exchange’s AML documentation, leading to an urgent inspection just days before its planned launch on April 29.
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Crypto.com entered the South Korean market by acquiring a local exchange, OKBit, which granted them a virtual asset business license (VASP). However, this recent regulatory scrutiny has forced a delay in their launch.
In response to the delay, a Crypto.com spokesperson stated:
Korea is a difficult market for international exchanges to enter, but we are committed to working with regulators to advance the industry responsibly for Koreans. We will postpone our launch and take this opportunity to make sure Korean regulators understand our thorough policies, procedures, systems, and controls.
This occurs as South Korea is tightening its crypto market regulations in general. For example, following new laws, foreign digital assets must submit a detailed white paper or technical manual designed for the South Korean market before being listed.
As South Korea continues to refine its regulatory framework, exchanges like Crypto.com need to align their operations with local requirements to enter this market.
Obtaining this license would mark an important step in Crypto.com’s worldwide expansion strategy, which recently included getting full operational approval in Dubai.
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