Trading Cryptocurrencies With Leverage Carries Risks For The Financial System Of The State, Said The Head Of The Bank Of Korea Lee Joo-el.
“excessive Levels Of Leveraged Cryptocurrency Trading Put Families At Risk Of Financial Loss Given The Volatility Of This Market. We Expect That The Increase In Cryptocurrency Trading Will Have A Negative Impact On The Financial System In This Regard, ”the Korea Herald Said .
Lee Pledged To Monitor Financial Institutions’ Transactions Related To Margin Trading In Cryptocurrencies, And Admitted That Lending Could Be Cut To Prevent Bad Debts That Could Negatively Affect The Country’s Banking System.
Earlier, The Central Bank Of South Korea Has Already Spoken About The Need To Track Cryptocurrency Transactions Using Individual Bank Accounts. This Measure Is Expected To Be Introduced In September. At The Same Time, All Cryptocurrency Exchanges Will Have To Complete Registration As Service Providers In The Field Of Virtual Assets. The Requirement Is Formally Introduced To Combat Money Laundering And Fraud.
Local Trading Platforms, However, Argue That The New Regulation Threatens Their Very Existence, According To A Separate Financial Times Publication…. While Major Exchanges Such As Upbit, Bithumb, Korbit And Coinone Are Willing To Comply With The Requirements For Identifying Customers Using Bank Accounts, Many Smaller Platforms Say They Cannot Enter Into The Necessary Agreements. Banks, In Turn, Refuse To Work With Such Exchanges, Fearing That They Will Have To Bear Responsibility For Possible Illegal Operations With Cryptocurrencies.
“there Is A Threat To Our Existence. We Strive To Legitimize Our Business, But Banks Do Not Want To Offer Us Support, ”said Lee Chul-i, Ceo Of Foblgate Exchange. He Admits That The Withdrawal Of Small Exchanges Into The Gray Zone Will Only Aggravate The Situation, And His Own Company Is Already Considering The Option Of Moving Abroad.
Some Experts Argue That The Local Cryptocurrency Market Is Overcrowded With Trading Platforms, So Stronger Regulation Will Benefit From An Investor Protection And Transparency Standpoint. Earlier It Became Known That Korean Youth Are Giving Up Their Usual Work For The Sake Of Cryptocurrency Trading.
