The Financial Times has reported that after September 17, 40 of around 60 exchanges in South Korea will close as a result of the country's Financial Services Commission (FSC) regulations.
The regulations oblige the platforms, among other things, to ensure compliance with KYC procedures together with partner banks.
However, credit institutions are reluctant to extend their cooperation with trading platforms for fear of additional scrutiny by financial regulators.
The FSC has forced crypto exchanges to register by September 24, while the companies have until September 17 to notify their customers about the possible closure of their accounts if they fail to complete this step.
Subscribe to our Telegram channel to stay up to date on the latest crypto and blockchain news.
The Financial Times claims that as few as 20 companies have complied with the regulator's instructions. For example, the country's largest platforms, Bithumb, Upbit, Korbit and Coinone, which account for 90% of all trading volume in South Korea, have already registered.
Notably, the FSC requirements have also affected foreign Bitcoin exchanges that offer their services to South Korean citizens. For example, in August, Binance banned its customers from using the South Korean won in transactions on its platform.