Last year, the domestic cryptocurrency trading industry, which was struggling due to massive damage caused by hacking and tax burden, stands at the crossroads of survival again. This is because the contract to use real name account service with the commercial banks terminates at the end of this month. The trading sites have made a bank account service use contract with commercial banks to offer deposit and withdrawal services to investors.
Cryptocurrency industry has been optimistic that the contract will be concluded without problems this year as it has been made without difficulties for the past two years. However, there are some viewpoints that banks are requiring more demanding conditions than before, as financial authorities stepped into the institutionalization of cryptocurrency this year.
According to the cryptocurrency trading industry on the 17th, the term of real name (bank) account contract for major cryptocurrency trading sites such as Upbit, Bithumb, Coinone and Korbit will be expired in January. Currently, the trading sites are in process with banks such as Industrial Bank of Korea (IBK) and NH Nonghyup for renewal of their contracts.
Since January 2018, the government has implemented the ‘real name financial transaction system for cryptocurrency’, which allows only real name verified accounts to trade cryptocurrencies to eradicate speculation and improve market transparency. Based on this, banks and cryptocurrency trading sites have reviewed real name account contracts every six months.
The cryptocurrecny industry predicts that banks will have more demanding account issuance requirements than before. This is because Financial Action Task Force (FATF) will begin inspection the implementation of regulatory guidelines for cryptocurrency trading sites in June. Based on the guideline, domestic cryptocurrency trading sites have increased obligations to prevent financial incidents such as grasping status of investor’s deposits and withdrawals.
In addition, passing of the ‘Revision of Specific Financial Transaction Information Act’, which includes cryptocurrency trading sites reporting system and mandatory Information Security Management System (ISMS), has been publicized so, it is expected that commercial banks will be stricter to issue accounts than before.
Actually, commercial banks issued accounts under more stringent conditions than before in August last year. One domestic bank asked one trading site to tighten regulations: △24-hour withdrawal latency system △Separation of customer assets and company assets △Operation of an abnormal transaction detection system for financial incidents △Protection of membership information △Expansion of anti-money laundering manual. The other bank also required a trading site to build a trading system to prevent voice phishing.
An official in the cryptocurrency trading industry said, “Commercial banks are generating huge profits worth tens of billions won every year through real name account contracts with trading sites, and the banks are pushing for new blockchain businesses, so they will not possible to terminate the contracts easily.” Also, he said, “But the government is pushing for the exchange reporting system and making issuance of bank account mandatory, so we need to observe if the banks will issue the accounts to small and medium-sized exchanges.” “Especially, it is difficult to be sure about the renewal of this contract because Upbit was stolen about 58 billion won in cryptocurrency last November.” he added.
Lee Su-ho, Song Hwa-yeon(2020.01.17) “실명계좌 계약만료 앞둔 코인 거래업계…은행 깐깐해지나”
retrieved from http://news1.kr/articles/?3818707
