Bithumb, the largest cryptocurrency exchange in South Korea has announced that it will shut down all the trading operations in 11 countries including the likes of Iraq, Iran, North Korea and eight other citing reasons of money laundering, terror funding and other activities which pose a potential threat to the global financial system.
In an official announcement on Monday, May 28, Bithumb said that the exchange will block all transactions of the residents belong to countries that fall under the Non-Cooperative Countries and Territories (NCCT) blacklist. The exchange clearly states that in order to comply with the global anti-money laundering laws, it will no longer accept new users from these 11 blacklisted countries by NCCT and in addition will disable all the accounts of the existing users from 21st of June, next month.
The NCCT countries as defined by the inter-governmental Financial Action Task Force (FATF) are those nations who have fallen short of making appropriate policies and regulations in order to restrict money laundering, terror funding and use of money for other illicit activities.
Banning users identified by NCCT and FATF, Bithumb will eliminate all the conflicts with the local financial authorities and other international regulators in regards to the use of digital currencies for illicit activities. Additionally, the development team at Bithumb will be asking foreign investors to undergo a mobile verification process in order to make sure that that they do not cheat the exchange by showing false personal information.
A Bithumb spokesperson said:
“The Bithumb team will voluntarily impose strict policies and cooperate closely with local financial authorities to increase the transparency in the cryptocurrency market and protect investors. With progressive voluntary policies, Bithumb will improve the global standard of cryptocurrency exchanges.”
Apart from this, the cryptocurrency exchange Bithumb has said that it will strengthen its own anti-money laundering policies by implementing the recommendations from the South Korean government as well as the Korea Blockchain Association. The ban on the trading activities in the NCCT blacklisted companies shows the long-term vision of the Bithumb exchange to bring in transparency in the crypto market.
Moreover, this is the most essential step the exchange needs to take to protect its integrity and proceed ahead with its plans of launching its own digital token Bithumb Coin.
The latest step by Bithumb seems to have been inspired from the recent money laundering incidents in Japan earlier this month, wherein millions of dollars were flushed out for illicit activities through three anonymous cryptocurrencies named Zcash, Monero, and Dash.
The countries oldest and most popular local publication Mainichi Shimbun reported that the Japenese government had immediately issued an order to the local crypto exchange to delist these three digital currencies from their platform. One of the officials told Mainichi that “It should be seriously discussed as to whether any registered cryptocurrency exchange should be allowed to use such currencies. It’s a typical money laundering scheme. In a way, I’m not surprised. If you are going to do something illegal, then everyone knows to use the ‘three anonymous siblings.”
So far things haven’t been going well for the Bitcoin community as the world’s largest cryptocurrency by market cap has been on a continuous sideways movement, ever since it failed to cross the $10000 resistance. According to the data on CoinMarketCap, Bitcoin was trading at a high of $9934 earlier this month, on May 5. Since then, the cryptocurrency has eroded its value by nearly 28% and is currently trading at $7249.