With the endless cases of hacks and all forms of wrongdoing in the South Korean crypto space, it appears authorities are now ready to put a permanent end to the activities of bad actors within its digital currency industry.
No Room for Privacy Infringements
According to a Chosun report, highly reputable South Korean regulatory agencies including the Korea Communications Commission and the Korea Internet & Security Agency have jointly launched an investigation into the management of people’s personal information by cryptocurrency exchanges in the country.
The move which comes in the wake of high-profile invasions of Korean exchanges by cyberpunks is expected to spot possible infraction of data privacy rights by virtual currency trading platforms and service providers in the sector.
Often, firms that collect clients’ data for KYC operations and other reasons have been found guilty of selling this valuable information to third parties.
Facebook and Google are excellent examples of such firms.
No Pardon for Erring Exchanges
Per local news source, Chosun, about eight cryptocurrency trading companies which have previously been found wanting and served corrective orders following their infringements of Korea’s Personal Information Protection Act back in 2017, will now be thoroughly investigated.
Precisely, the investigation is aimed at finding loopholes in crypto exchanges technical and administrative protection of investors personal data, as well as data access control, anti-tampering features, User data encryption, and protection against malware threats.
The investigating authorities have not failed to state it categorically that firms in the Korean ‘cryptoverse’ that are found to have violated the nation’s data privacy laws either by the mode of data collection, application or disposal will attract severe sanctions.
More Stringent Penalties Possible
Due to the recent adverse developments, Asian exchanges are becoming more and more subjected to tensed sanctions in the regulatory agencies bid to enforce compliance with anti-money laundering (AML) as well as KYC standards.
In June 2018, Japanese regulators ordered the FSHO cryptocurrency exchange to shut down its operations, citing irregularities in their business as well as a below-par security system.
Similarly, Korea’s Financial Services Commission (FSC) is leaving no stone unturned in their fight against bad actors and has recently reviewed specific AML rules for crypto exchanges in a bid to curb the operations of fraudsters entirely.
Asia remains a force to reckon with in the global blockchain-based digital currency industry, and it’s a good thing that authorities are hard at work, trying to sanitize their cryptosphere. If all goes well in the long run, it would also have a positive effect on the global cryptocurrency industry in general.