South Korea's FIU seeks to block domestic access to two unregistered virtual asset service providers; DAXA refers three involved entities for investigation

TechFlow reported on October 30, citing Yonhap News Agency, that South Korea's Financial Intelligence Unit (FIU) on October 30 asked the Korea Communications Standards Commission to block domestic access to two unregistered virtual asset service providers, including terminating their services. On the same day, the Digital Asset Exchange Association (DAXA) referred Aegis Ventures, TetherMax and SuperTrust for investigation on suspicion of violating the Act on Reporting and Using Specified Financial Transaction Information and operating virtual asset businesses without registration. The FIU requested blocking access to TetherMax and SuperTrust. Aegis Ventures has no standalone website or mobile app, so it was not included in the blocking request.

Under current law, those operating virtual asset businesses without registration can face up to 5 years in prison or a fine of 50 million KRW. The law also applies to overseas operators serving South Korean residents. The FIU said unregistered operators are in a regulatory blind spot and may be used for money laundering. This June, DAXA and compliant operators jointly conducted a concentrated investigation and found that the average transaction fees of operators caught ranged from 1.5% to 10%, up to about 62 times the average level of South Korea's top five KRW exchanges (0.16%).

Source: TechFlow