South Korea's financial watchdog has launched an investigation into crypto exchange OKX, accusing it of violating regulations and operating without registration in the country. At this time, South Korea has significantly tightened its controls on unregistered virtual addressable service providers (VASPs).
The OKX exchange, which provides a significant volume of global cryptocurrency trading, is facing scrutiny over its operations. As mentioned above, the exchange provides cryptocurrency trading services to Korean traders through the OKX Jumpstart platform.
In this regard, an investigation into OKX's activities has been launched in South Korea. According to media reports, OKX is being prosecuted for operating in South Korea without official registration, CoinGape reported.
The Digital Asset Exchange Association (DAXA), a member of the association of leading cryptocurrency exchanges in South Korea, informed the regulator about OKX's illegal activities by operating without complying with regulatory requirements.
It was revealed that the OKX-funded platform was promoting OKX Jumpstart through influencers on Telegram, using targeting to reach Korean users. South Korea's strict regulatory framework requires all cryptocurrency exchanges to obtain licenses from the local regulator before offering trading services to Korean investors.
The legal operation of foreign exchanges in the country must be confirmed by registering and obtaining a license from the South Korean regulator, or the exchange must stop providing services in Korean.
Following the DAXA report, the FSC's Financial Intelligence Unit (FIU) is investigating the legality of OKX's operations in the country, confirming the authorities' commitment to enforcing regulatory compliance in the crypto industry.
The FSC previously introduced strict regulations for virtual asset service providers (VASPs) in South Korea. The regulator is also developing plans to combat cryptocurrency market manipulation and illegal trading.
Violators who earn more than 5 billion won could face life imprisonment. Notably, the CEO of the scandalous exchange Bitsonic faces 7 years in prison for illegal cryptocurrency operations.
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