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South Korean Crypto Exchange Bithumb to block unverified private wallets

Users of Bithumb have 2 days to perform another round of KYC to whitelist their private wallets, or else they won’t be granted further crypto withdrawals.

SOUTH-KOREA
Photo by Sean Pavone

Jan 27th onwards, the South Korean crypto exchange known as Bithumb, shall no longer allow anyone with unverified private wallets to withdraw crypto assets.

On the 24th of Jan, the exchange made an announcement regarding it being the second of 4 major exchanges within the country that would ban withdrawals to wallets that are unverified. Coinone was also one to enact a very similar policy towards the end of last month, with other exchanges being Upbit and Korbit.

Per their new policy, users may only register their own private wallets. For them to perform the registration process, they must undergo an additional battery of KYC identity verifications.

Of course, any withdrawals made to any domestic centralized exchange, as well as foreign centralized exchanges with KYC processes like Kraken, Bitstamp, Blockchain.com, Bybit, and Binance.US are still universally approved.

Money Today, a local news outlet made a report that cited the exchange was facing a ton of pressure from Nonghyup Bank, its partner bank, to make the policy change for them to comply with the FATF Travel Rule. Said Travel Rule is designed to let financial institutions know the sender’s and receivers’ identities for across borders funds.

As such, the bank most definitely “strongly demanded” the exchange ” “block all personal wallets that do not have their own KYC system.” Among those wallets, MetaMask, MyEtherWallet are included.

Any and all South Korean exchanges offering Korean Won (KRW) trading pairs is in fact required to have a domestic partner bank tasked with issuing real-name bank accounts to its users. Partner Banks such as Nonghyup and Bithumb and even Coinon have a really strong impact on the exchange’s policies.

The purpose of Real-Name bank accounts are to make sure that the people accepting fiat withdrawals from an exchange are one and the same as the one’s trading crypto on its platform. The policy really helps the exchange come into compliance with the Travel Rule by the deadline of March 25th.

So far, Upbit and Korbit haven’t issued any sort of policy changes regarding personal crypto wallets. On March 25th, though, these exchanges shall be required to set policies when the Korean government deems it absolutely necessary for all exchanges to adopt such policies.

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