Bithumb to ban foreign users who fail mobile KYC as regulations bite harder

Getting your Trinity Audio player ready...

One of South Korea’s largest digital currency exchanges will become the first to ban foreign users who fail the mobile phone Know-Your-Customer (KYC) verifications amid the tightening of regulations in the country. Bithumb has yet to announce the date when this mandatory KYC will commence.

South Korea has long abandoned its hands-free approach to digital currencies and has continued to shore up its policies governing the sector. In response, Korean exchanges have been ramping up their compliance efforts as deadlines loom.

According to Pulse, Bithumb is the latest to take an extra measure, insisting that all foreign nationals who reside in the country must conform to a mandatory mobile phone verification rule. This rule will likely be enforced before the end of the year, but the exchange didn’t specify the exact date of the rollout, aside from saying that “it’s within 2021 when customer due diligence becomes mandatory.”

This new rule follows up on a previous decision by Bithumb to not allow foreigners to register as new users without their alien registration cards.

In its announcement, Bithumb urged all foreigners who are unable to comply with this new rule to withdraw their assets before it starts enforcing it.

The new rule comes barely three weeks before the deadline for Korean exchanges to register with financial authorities. As the deadline has neared—being on September 24—exchanges have taken renewed measures to meet their obligations. These include establishing real-name verification for users in partnership with local banks as well as gaining the Information Security Management System (ISMS) certificate.

Upbit is the only exchange in South Korea that has fully completed its obligations and registered with the Financial Intelligence Unit. The head of the financial regulator had indicated two weeks ago that he expected two other exchanges to register before the end of September, but so far, Upbit remains the only one with this distinction.

Watch: CoinGeek Zurich panel, The Future of Trading & Digital Assets