Monero continues to be pursued by South Korean regulators
The new regulation on virtual assets that will take effect in South Korea in March, will ban cryptocurrency exchanges from trading Monero and other so-called “dark coins” (cryptocurrencies with a high level of privacy).
According to the local newspaper Electronic Times, dark coins are at high risk of being used for money laundering due to the difficulty in determining the details of the transaction. For this reason, registered virtual asset operators are completely prohibited from trading them.
It should be noted that, in South Korea, the law stipulates that, obligatorily, all operators that provide services to their customers regarding virtual assets must be registered and authorized by the Financial Intelligence Unit (FIU) of the Financial Services Commission.
In addition to Monero, all other cryptocurrencies whose transactions cannot be tracked because they hide tracking details, such as Zcash, Verge, Bytecoin and probably Dash, will also be banned.
Therefore, the barriers and limits to the cryptocurrency trade are increasing in the country, as has been happening for some time.
South Korea is in fact one of the countries in the world with the highest use of cryptocurrencies, especially for speculation, with some of the largest cryptocurrency exchanges in the world. The South Korean government has been strictly monitoring crypto exchanges for some years, and new regulations have been under consideration since at least March 2020, with rumors about banning private currency exchanges since November.
In addition, the FIU will also request Korean exchanges to report any unusual transactions on their platforms within three business days.
At this point, South Korean residents who wish to buy or sell XMR (Monero) or other privacy currencies have no choice but to use foreign currencies, under the risk of detection, or decentralized exchanges. However, decentralized exchanges are not based on privacy currency blockchains, so trading Monero, Zcash, Dash on DEXs is not particularly easy in the rare cases where it is possible to do so.
As South Korea is an interesting market for cryptocurrencies, this ban could lead to the development of new solutions to allow South Korean residents to exchange privacy currencies, especially in a decentralized way, that is, without censorship.