Six unnamed commercial banks in South Korea are being scrutinized by regulators for their relationship with the country's bitcoin exchange ecosystem.
According to a Jan. 8 statement, the Korea Financial Intelligence Unit and the Financial Supervisory Service want to know whether the banks – which offer accounts for cryptocurrency trading – are properly complying with anti-money laundering and customer identification rules.
"The inspectors will look into whether the banks comply with their anti-money laundering (AML) obligations in their transaction with cryptocurrency exchanges; and whether they have in place appropriate measures to verify their customers' identification in regard with cryptocurrency trading," the agencies remarked.
The release went on to note that officials will also investigate whether the banks have electronic systems to match deposit holders' names with virtual account holders and if the banks can halt transactions with exchanges which refuse to provide customer information, among other areas.
The release noted that the South Korean government is monitoring cryptocurrency trading, concluding:
Buildings image via Shutterstock
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.