Top S Korea Crypto Exchanges Roll Out AML Program

Bithumb, Upbit, Coinone, and Korbit want to stop criminals from using virtual assets for money laundering and thus undermining investor trust in the market.

Four of the largest cryptocurrency exchanges in South Korea - Bithumb, Upbit, Coinone, and Korbit - have teamed up in a push to bring more security and trust in the virtual assets industry. The operators have launched an anti-money laundering (AML) program for sharing suspicious activities, Bithumb said in a press release on Monday.

The initiative aims to prevent problems such as phishing attacks, hacks, and other forms of fraud. Bithumb, Upbit, Coinone, and Korbit have established a hotline for AML issues and will report wallet addresses with strange movements in a shared database. If a trader tries to disperse a large amount of funds from a single wallet, the exchanges will block the transactions, Bithumb noted. Moreover, if any of the platforms detects fraud, the trader will be banned on all of them, and they will report the issue to the authorities immediately.

The AML program is part of efforts by the quartet to create a crime-free crypto environment and was rolled out after the companies obtained information security management system (ISMS) licenses from the Korea Internet and Security Agency, Bithumb said. The initiative is open for participation to other trading platforms.

The program comes amid growing scrutiny from South Korean authorities after several hacks targeted local exchanges, including one that led to a $30 million theft from Bithumb in 2018. Last week, Korbit warned about ongoing phishing attempts.

Earlier this month, Bithumb, Upbit, Coinone, and Korbit along with Huobi Korea, Gopax, and Hanbitco passed a government test of their security systems, while 14 other operators failed.

South Korea is one of the markets with the largest daily trading volumes. Bithumb clocked $1.3 billion in volumes in the 24 hours to 10:04 UTC on Monday, according to Coinmarketcap data. Upbit had $134.7 million, while Coinone and Korbit recorded $8.9 million and $7 million, respectively.

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