Korea’s leading exchanges accuse OKX of operating without registration

The Financial Services Commission is expected to begin investigating OKX’s activities

07.02.2024 - 15:05

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What’s new? Crypto exchange OKX has been accused of violating regulations in South Korea. The accusations came from the Digital Asset Exchange Alliance (DAXA) working group, which includes five of the country’s largest crypto exchanges — its representatives told local authorities that OKX was operating without proper registration.

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What else is known? DAXA’s claims are related to the Jumpstart program, which OKX allegedly promoted among local crypto users through Telegram bloggers for a fee.

OKX Jumpstart is a launchpad where startups can raise funding from users. Users block OKB exchange tokens and earn coins for new projects. The platform has already helped earn $3,8 billion in programs for 15 projects, including blockchains SUI and TON.

The country’s authorities require foreign crypto exchanges to register before serving local customers. Back in 2021, the Financial Services Commission (FSC) called on 27 foreign platforms to undergo local registration or stop providing services in the Korean language. However, the rules do not prohibit local users from accessing foreign exchanges.

Korean authorities have toughened penalties for violating the law protecting crypto users

One can get up to life imprisonment for market manipulation, fraud, and insider trading on a large scale

The FSC’s Financial Intelligence Unit is expected to launch an investigation into OKX after receiving the DAXA report. DAXA was formed in 2022 after the collapse of the Terra blockchain ecosystem to make a concerted effort to stabilize the crypto ecosystem. The group’s members account for more than 99% of cryptocurrency trading volume in Korea. DAXA includes Upbit, Bithumb, Korbit, Coinone, and Gopax.

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