USD 1.8M Worth of Crypto & Fiat Remains in Limbo in South Korea


Only half of the South Korean crypto and fiat that was lost last month have been recovered. This fiat can be converted into fiat, withdrawn through banks, or transferred to another exchange. However USD 1.8m remains unaccounted for after the shutdowns.

reported that scores of exchanges had to close after the country imposed strict rules on trading platforms. To offer crypto-tocrypto trading, they had to be certified by the government’s information security management system (ISMS). Real-name-authenticated bank service partners were also required if they wanted to offer fiat trading.

Segye Ilbo reported that 13 platforms tried to get ISMS certification but failed – and were thus forced to close. These platforms were home to USD 3.5m in fiat and coins, according to the Financial Intelligence Unit.

However, USD 1.76m was only recovered two weeks ago.

FIU said it was working with investigative agencies to “respond to concerns” about exchanges trying to avoid refunding customers as they close down.

Exchanges that were closed on September 25 were informed they must be operational for at least 30 days in order to refund customers. Customers were also advised to withdraw funds as soon as possible from these platforms.

According to the media outlet

According to the media outlet, “some exchanges” experienced server issues that caused delays.

The FIU could also be used to address a more difficult problem, namely ” planned bankruptcies”, where companies try to use the legal system in order to claim that they are unable to repay customers.

Although no such bankruptcies were reported to the financial authorities yet, the fact that so many crypto and fiat remains unclaimed or not refunded will be of concern.

On September 25, 36 exchanges were closed completely, including 13 of the ones mentioned that failed to get ISMS certification. Twenty-three other exchanges did not apply for ISMS certification, creating another potential minefield of unrefunded fiat and crypto.

Two trading platforms, Upbitand Korbit, have been granted FIU operating permits to fiat markets. Coinone and Bithumb are still waiting for the results of their applications.

Another 25 exchanges have received ISMS certification and are now allowed to offer crypto-tocrypto services.

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