The Financial Services Commission of Korea will impose a fine of 100 million won exchange employees who trade on its work platform. However, there is no law prohibiting exchange executives and employees from trading cryptocurrencies on their platforms.
Officials from the South Korean Financial Intelligence Unit met with the heads of major South Korean cryptocurrency exchanges on June 3. FIU informed them of the latest laws.
South Korea’s latest Financial Transaction Reporting Act requires all cryptocurrency exchanges to register with FIU before September 24, 2021
However, registration is not a simple archiving process. Exchanges must meet strict conditions to be approved for registration. These conditions include establishing partnerships with commercial banks, obtaining approval from their anti-money laundering, and knowing your customer (KYC) systems.
Any exchanges that have not been approved by the deadline will be closed. FIU also stated that registered businesses whose executives or employees traded on their platform after the September deadline would be deregistered.
South Korea’s significant exchanges have formulated corporate policies restricting employee transactions. However, many of them will be muted by FIU’s new restrictions.
Upbit is one of the world’s largest exchanges in terms of the trading volume. Currently, employees are allowed to trade on their platform, but they are prohibited from contacting any non-Bitcoin, Ether, or Tether cryptocurrency. In addition, all company employees are prohibited from buying or selling anything other than these three cryptocurrencies. It does not matter which platform they use.
Additionally, Upbit employees need to report how much cryptocurrency they own and how much they profit from each transaction. There is also a limit on the number of transactions they can trade each year. However, this limit has not been announced.
Bithumb is another major player in South Korea. It allows employees to purchase and trade the new cryptocurrency within 72 hours after being listed on the exchange. It also prohibits transactions during working hours. Bithumb also requires all employees to sign a statement declaring that they won’t use company information and data for personal trading profits.
If the ban is implemented, employees of these exchanges can still trade cryptocurrencies. Though, they can only sell on other platforms, not on the platforms of their employers.