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Bithumb Boss: Only 4-7 Korean Crypto Exchanges Will Survive Regulations

Bithumb

Exchange

Regulation

South Korea

Last updated: June 26, 2023 06:54 EDT

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Tim Alper

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Tim Alper is a British journalist and features writer who has worked at Cryptonews.com since 2018. He has written for media outlets such as the BBC, the Guardian, and Chosun Ilbo. He has also worked...

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Last updated:

June 26, 2023 06:54 EDT

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The CEO of Bithumb Korea, the domestic wing of the South Korean market-leading crypto exchange Bithumb, has predicted that after soon-to-promulgate regulations kick in, there will only be between four and seven exchanges left standing.

There are currently almost 50 crypto trading platforms in the nation. New rules governing the sector will become effective in March this year, although exchanges have been given an additional six months’ grace period in which to adopt full compliance measures.

The regulations will force exchanges to abide by real-name banking protocols, with all customer accounts linked to individual, social security number-authenticated bank accounts.

Banking contracts will be made at the sole discretion of banks, who will be able to rule on exchanges’ reliability. In addition, platforms will have to obtain security and Information Security Management System (ISMS) certification and abide by anti-money laundering protocols.

At present only Bithumb – as well as its rivals Upbit, Korbit and Coinone – have real-name banking capabilities. Some five or six other exchanges have recently obtained ISMS approval, however, indicating that they are hopeful of meeting compliance deadlines.

But in an interview with Hanguk Kyungjae, Bithumb Korea supremo Heo Baek-young, who was appointed to his current role in May last year, claimed that smaller companies would struggle to meet ISMS requirements.

He stated that post-March, “there will be only four exchanges left, and seven at most,” due to the prohibitive cost for SMEs of even attempting to obtain the ISMS certification required by the new legal amendment.

But Heo welcomed the rule change, as have many of the sector’s bigger players.

The CEO opined that a lack of regulation had allowed “companies with bad intentions” to “do business,” and claimed the rules were a step in “the right direction.”

Heo added that his company also planned to expand in 2021, and intends to hire over 50 new staff members.

However, the CEO made no mention of the fact that a controlling stake in the company has been put up for sale.
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