South Korea Regulator Targets Top Crypto Exchanges

South Korea’s Financial Supervisory Service (FSS) has summoned the nation’s top five cryptocurrency exchanges—Upbit, Bithumb, Coinone, Korbit, and Gopax—to address recent fee hikes amid new regulations.

This action, taken on July 24, 2024, is part of a broader regulatory crackdown following the introduction of the Virtual Asset User Protection Act.

The FSS’s scrutiny comes after Bithumb raised its deposit fee from 2.2% to 4% per year, a move it later retracted. Other exchanges like Upbit and Korbit have also increased their fees since the Act’s enforcement. The FSS is investigating whether these fee increases comply with the law’s requirement for “reasonable” fees.

The meeting aimed to clarify how fees are calculated and to address disputes over their fairness. Exchanges were asked to provide detailed information on their fee structures and deposit practices.

This oversight is part of South Korea’s wider regulatory efforts to tighten control over the cryptocurrency market. The FSS has also introduced measures to monitor unusual trading patterns, while the Digital Asset Exchange Alliance (DAXA) reviews over 1,300 digital assets for compliance. The new regulations signal a significant shift towards stricter oversight in the crypto sector.