South Korea FIU Sanctions Trigger Upbit Suspension
South Korea’s Financial Intelligence Unit has imposed a partial business suspension on Upbit for alleged violations of local transaction laws. The ban affects new client activities but allows existing customer trading to proceed unhindered.
Dunamu Inc., Upbit’s operator, is taking legal action to challenge the sanctions while implementing compliance improvements. The company states it aims to align with the local regulatory framework while maintaining operational integrity. As Sirgoo Lee, CEO of Dunamu Inc., stated, “Upbit is reviewing and taking action on the necessary improvements in response to the financial authorities’ recent sanctions.”
Temporary Trading Volume Dip Predicted by Analysts
Market analysts expect a temporary dip in trading volume due to restricted onboarding. Long-term impacts remain uncertain, but similar past sanctions have resulted in increased compliance costs without substantial market exits.
Experts anticipate a moderate impact on BTC and ETH trading volumes, as Upbit holds significant reserves in these assets. Past historical trends suggest strong market anchors will help maintain stability during the suspension period.
Regulatory History Suggests Swift Upbit Recovery
Similar regulatory actions in Korea have typically resulted in short-term disruption. However, historically, platforms like Upbit with strong domestic market shares usually stabilize swiftly without major outflows.
Experts from Kanalcoin note the necessity of adhering to regulatory norms. They emphasize Upbit’s strong asset base and previous adaptability as reasons for expected resilience amid these challenges.
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