SEOUL, Dec. 15 (Korea Bizwire) – South Korean cryptocurrency exchanges said Friday they will adopt a raft of self-regulatory measures to improve transparency in trading to keep the unregulated market in check amid worries over a bitcoin frenzy.
The Korean Blockchain Industry Association composed of 14 virtual currency exchanges said its members agreed to require investors to verify their identification through financial institutions and use a single account to carry out transactions.
The association also said it will allow qualified operators with assets worth over 2 billion won (US$1.83 million) to tap into the market to protect investors.
The association, whose members include South Korea’s largest exchange Bithumb, announced the measure after the Seoul government proposed regulations, including a ban on trading by financial institutions, minors and foreigners.
In light of the regulatory moves, Woori Bank, Korea Development Bank and Shinhan Bank said they will shut down virtual accounts offered to cryptocurrency exchanges by the end of this year.
The association will establish a set of specific ethical codes on the virtual currency bourses, including insider trading and market manipulation.
They also vowed to expand investment in their security systems and provide information on new virtual currencies when listing them.
The association said members will kick off a new verification system next month and adopt other self-regulatory measures in the first quarter of 2018, though they are not legally binding.
South Korea is home to one of the world’s biggest bitcoin exchanges, with about 2 million people estimated to possess some of the best-known digital currencies, such as bitcoin and ethereum.
The virtual currency turnover at Bithumb soared to 56.3 trillion won in November from some 300 billion won in January, according to the exchange operators.
The November figure was more than 80 percent of the monthly average turnover of 68.7 trillion won on the KOSDAQ, the nation’s secondary stock market.