The self-regulatory inspection of South Korean cryptocurrency exchanges is complete. Fourteen out of 23 exchanges agreed to be inspected. Twelve met the self-regulatory standards despite security flaws, raising questions of how effective the inspection is.
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12 Exchanges Pass Security Checks
The Korea Blockchain Association (KBA) held a press conference Wednesday to announce the results of its inspection of cryptocurrency exchanges operating in the country. The Association “gave a nod to the cybersecurity standards of 12 cryptocurrency exchanges,” the Korea Herald reported.
The KBA has been heavily promoting self-regulation since its establishment last year. Out of 23 members that are crypto exchanges, 14 of them voluntarily agreed to be inspected. According to the news outlet:
Exchanges that gained self-regulatory affirmation were 12 out of 14: Dexko, Hanbitco, Okcoin Korea, Huobi Korea, Bithumb, Upbit, Neoframe, Gopax, Cpdax, Coinzest, Korbit and Coinone. Operators of the other two — Sunny7 and Komid — withdrew from the KBA-led inspection.
The inspection was conducted “through interviews by third-party experts authorized by KBA in June and July,” the publication noted, emphasizing that a “hacking simulation on the exchanges did not take place.”
Nonetheless, the association said the 12 exchanges met “general standards” such as “minimum total assets, adoption of a cold wallet, anti-money laundering requirements and dozens more.” They also met “the criteria for cybersecurity standards, which the association referred to as minimum requirements.”
Association Criticized for Poor Screening
Following the KBA’s announcement, some industry participants pointed out major flaws in the inspection.
The association has come “under fire for poor screening of cryptocurrency exchanges,” the Korea Times wrote, emphasizing that “the KBA even extended its one-month inspection to two
