Foreign crypto exchanges limit S. Korean transactions due to tighter regulations

Foreign cryptocurrency exchanges have distanced themselves from South Korea due to tighter regulations against virtual coins.

US-based cryptocurrency exchange Bitfront, set up by the messaging app company Line, will discontinue payments with Korean credit cards and stop providing a Korean-language service on Sept. 14, citing the tougher regulations.

Earlier, Binance, the world's largest cryptocurrency exchange, announced it halted Korean currency trading pairs and payment options.

Under the stiffer regulations, cryptocurrency exchanges targeting Korean investors must register with the nation's anti-money laundering body by Sept. 24 and disclose their details on risk management.

Banks are also required to issue real-name accounts in line with stricter guidelines to prevent money laundering.

Consequently, cryptocurrency exchanges with no real-name bank accounts will be unable to withdraw money for cryptocurrency trading by Sept.25.

Separately, South Korea will impose a 20 percent capital gains tax from cryptocurrency transactions next year, despite pleas for delaying the taxation plan.

Many analysts expect minor Korean cryptocurrency exchanges, which are estimated to number around 100, to shut down because they are unlikely to comply with the tougher regulations.

Korean investors continue to buy virtual currency as a lucrative investment amid the pandemic.