Source: Cointelegraph Original: "{title}"
The South Korean court has temporarily lifted part of the business suspension order against the cryptocurrency exchange Upbit, which previously prohibited the trading platform from providing services to new customers for three months.
On February 25, the South Korean Financial Intelligence Unit (FIU) imposed sanctions on the exchange, implementing a three-month ban on deposits and withdrawals for new customers. The FIU stated that the suspension order was in response to Upbit's violation of the policy prohibiting exchanges from trading with unregistered virtual asset service providers (VASPs).
In response to the FIU's sanctions, Upbit's parent company Dunamu filed a lawsuit against the FIU, seeking to overturn part of the suspension order. Additionally, Dunamu applied for a restraining order to temporarily lift the suspension.
On March 27, local media Newsis reported that the court approved the restraining order, postponing the suspension for 30 days after the court's ruling. This allows Upbit to continue providing services to new customers during the legal battle.
Founded in 2017, Upbit is the largest cryptocurrency exchange in South Korea. On October 10 of last year, the country's Financial Services Commission (FSC) launched an investigation into Upbit for potentially violating the country's antitrust laws.
In addition to antitrust violations, the exchange is also suspected of breaching Know Your Customer (KYC) rules. On November 15, the FIU confirmed that the exchange had at least 500,000 to 600,000 potential KYC violations. These alleged violations were discovered by regulators while reviewing the exchange's business license renewal.
In 2018, South Korean regulators terminated anonymous cryptocurrency trading for its citizens. With the implementation of new regulations, users must go through the KYC process to be allowed to trade digital assets on cryptocurrency trading platforms like Upbit.
In addition to these allegations, the FIU also accused Upbit of facilitating 45,000 transactions with unregistered foreign cryptocurrency exchanges. This violates the country's Specific Financial Transaction Information Reporting and Use Act.
On October 25, 2024, South Korea strengthened regulations on cross-border cryptocurrency transactions. The country's Finance Minister Choi Sang-Mok stated that the government would introduce mandatory reporting requirements for businesses handling cross-border digital asset transactions.
This aims to promote pre-monitoring of cryptocurrency transactions "used for tax evasion and currency manipulation."
According to these regulations, the South Korean Google Play Store has blocked the applications of 17 cryptocurrency exchanges at the request of the FIU. The FIU stated that it is also working to restrict access to these exchanges through the internet and App Store.
Related: Google Play Store imposes access restrictions on 17 unregistered exchanges in South Korea.
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