Upbit, one of South Korea’s largest cryptocurrency exchanges, has temporarily suspended deposits and withdrawals exceeding 1 million Korean won ($721) following modifications to the operations of Ten&Ten, a local Virtual Asset Service Provider (VASP). The suspension is due to Ten&Ten’s service withdrawal, which impacted Upbit’s ability to facilitate high-value crypto transactions in compliance with South Korea’s implementation of the FATF crypto travel rule. The South Korean government has established a minimum threshold of 1 million won for compliance with the Crypto Travel Rule, prompting Upbit to take action and notify its users. Affected users have until April 22 to complete necessary transactions before the suspension goes into effect.
In response to the suspension of Ten&Ten’s services, Upbit has implemented measures to mitigate disruptions and ensure continued service provision while adhering to regulatory guidelines. The recent regulatory developments in South Korea’s cryptocurrency ecosystem have seen the South Korean won surpass the U.S. dollar in crypto-fiat trading volume during the first quarter of 2024. Data from Kaiko shows that transactions denominated in Korean won on centralized exchanges have surpassed those denominated in U.S. dollars, indicating a significant shift in trading preferences.
South Korea is preparing to implement stricter regulations to refine the token listing process on cryptocurrency exchanges. The country’s financial authorities are finalizing virtual asset trading support guidelines expected to be unveiled by the end of the month or early next month. The Financial Supervisory Service (FSS) has been collaborating with industry stakeholders such as the Digital Asset Exchange Association (DAXA) to establish robust standards that aim to bolster investor protection and market transparency. These guidelines are part of an effort to create a more regulated and secure environment for cryptocurrency trading in South Korea.
A recent survey conducted by the Korea Women’s Policy Institute revealed a shift in attitudes among young South Koreans towards the national pension system. The survey, which polled individuals aged 20–39, showed widespread disillusionment with state-issued pensions, with over three-quarters expressing a lack of trust in the system. This skepticism is driven by concerns over rising insurance premiums and doubts about the sustainability of the National Pension Service (NPS) amid demographic challenges. Many young South Koreans are turning to alternative investment avenues, including stocks and cryptocurrencies, to build their retirement funds, signaling a growing disinterest in traditional pension schemes among younger demographics.
Overall, the cryptocurrency landscape in South Korea is evolving rapidly, with exchanges like Upbit facing challenges related to regulatory compliance and service disruptions. The shift towards using the South Korean won over the U.S. dollar in crypto-fiat trading volume reflects changing preferences among traders in the country. As South Korean authorities prepare to introduce stricter regulations for token listings on exchanges, the industry is poised for further changes that aim to enhance investor protection and market transparency. This period of transformation is also characterized by a growing trend among young South Koreans to seek alternative investment options like stocks and cryptocurrencies, pointing towards a broader shift in financial attitudes and behaviors within the country.
