The South Korean Bithumb exchange has implemented a new policy that prevents employees from investing in or trading cryptocurrencies using Bithumb accounts.
The new policy is in accordance to an official notice published on July 2. It follows several decisions made by the country’s regulators, specifically targeting crypto exchanges, as it tries to rein in the market and protect investors.
CEO Back Young Heo said that the exchange would focus on strengthening internal regulations “to enhance transaction transparency and ban investments.” He also referred to previous policies that had already been implemented, which prohibited the leakage of undisclosed information, unfair trade practices, and market manipulation.
To ensure that employees follow this new policy, Bithumb will also completely ban Bithumb trading accounts for investment purposes by employees. Staff members have reportedly sent written statements concerning account withdrawals last month. The exchange will also implement a continuous monitoring system with self-audits and an internal reporting system.
The decision comes at a time when South Korea’s financial authorities have decided to impose restrictions on the market to ensure investor protection and prevent money laundering and market manipulation.
Other exchanges may soon follow with similar policies — or perhaps even more. The new regulatory landscape in the country makes it clear to exchanges that they must change or else be forced to cease operations.
South Korea not taking crypto regulation lightly
South Korea has ramped up its examination of the crypto market in the past 12 months, with officials issuing multiple new laws to ensure compliance. Changes have included a new taxation plan and a ban on privacy coins.
But perhaps the most significant change is a broad compliance guideline for crypto exchange regulation, which exchanges are now compelled to meet — or else shut down. The new requirements mean that exchanges will have to apply for a new license in Q3, which is when the country’s first fully regulated exchange could be recognized.
Some exchanges have balked at the new rules, leading some of them to shut down operations in the country. OKEx, one of the world’s largest exchanges, is one such entity that decided to close shop.
Globally, South Korea is pioneering new crypto market regulation, which is unsurprising given the popularity of the asset class in the region. The new changes have not dampened enthusiasm too much, though exchanges are worried that it may hurt business revenue.