OKX, the world’s third-largest cryptocurrency futures exchange by trading volume, has come under scrutiny from South Korea’s financial watchdogs. The Financial Intelligence Unit (FIU) launched a criminal investigation into the exchange’s activities in South Korea following allegations of illegal activity. This development highlights regulators’ crackdown on virtual asset service providers (VASPs) operating without required compliance. Here are the details…
Crypto exchange OKX is under investigation in South Korea
Recent allegations in South Korean media have revealed that OKX may have circumvented regulations by engaging in unreported operations in South Korea. The Digital Asset Exchange Association (DAXA) reported these findings to the Financial Intelligence Unit, leading to an in-depth investigation of the matter. The investigation focuses on OKX’s promotional tactics. It reportedly involved leveraging local influencers to attract Korean users; This was a strategy that raised important legal and ethical questions. The problem started with the OKX website’s lack of Korean language support. This is very important for currency exchanges in Korea. Financial authorities also targeted other currencies on similar issues. They emphasize the need for open and legal relationships with Korean customers.
The problem started when the OKX website did not provide Korean language support, a critical feature for international exchanges operating in Korea. Financial regulators have similarly examined other foreign platforms for comparable shortcomings, emphasizing the importance of transparent and legal interactions with Korean customers. Cryptocurrency exchanges must comply with South Korean laws to cater to the country’s more than 9.73 million crypto users. According to estimates, the number of users will increase to $12.02 million by 2028
Were OKX’s moves really in conflict with the law?
Despite this, OKX’s approach, particularly its use of the Telegram platform for promotion, suggests a calculated attempt to circumvent these regulations. Experts argue that OKX’s promotional activities are in direct violation of the Private Financial Information Act by specifically targeting the Korean market through social media influencers. An official from the domestic crypto industry said, “I understand that OKX is promoting Jumpstart to the Telegram community for a fee. “It became a problem because it was a kind of sales targeting Korea,” he said. .
The Financial Intelligence Unit’s investigation into OKX is a key moment in ongoing efforts to ensure compliance and protect investors in the cryptocurrency industry. As a result, South Korean financial regulators have scrutinized OKX, the world’s third-largest cryptocurrency futures exchange by trading volume. The Financial Intelligence Unit (FIU) has launched a criminal investigation into South Korea over allegations of illegal activity in the stock market. This development highlights that regulators are tightening their oversight of crypto asset service providers (VASPs) operating without the necessary compliance.
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