News

South Korean Exchanges Ordered to Revise their Contracts

0 Comments

South Korean cryptocurrency exchanges have been ordered to revise their adhesion contracts after being accused of dealing a bad hand to its customers.

The Fair Trade Commission says the existing contracts give little protection to users who often have to shoulder huge losses when they decide to quit. Users are required to sign the contracts before opening an account.

South Korean exchanges ordered to revise their contracts

Adhesion contracts usually give customers little choice to negotiate the terms. 12 exchanges are now expected to overhaul their contracts with fair terms according to Yonhap. The exchanges have also been accused of offering limited services.

Over a third of South Korean workers are said to hold an average of $5000 worth of cryptocurrencies.

The Fair Trade Commission which also ensures fair competition accuses the exchanges of unfairly keeping their customers from making withdrawals.

Members usually suffer all financial losses that result when they terminate their relationship with the exchanges, the FTC says.

FTC Chairman Kim Sang-joo caused a storm early in the year after calling for regulation of the sector. Many assumed a total ban was coming. The huge backlash that followed led the regulator to soften its stance.

The FTC issued a statement thereafter saying it was not possible to ban cryptocurrencies under the country’s laws.

South Korea remains one of the most vibrant locations for cryptocurrency trading worldwide.

No Anonymous Trading

Regulators have however been moving to stop anonymous trading. Traders are now required to use real-name bank accounts. Certain banks have stopped offering such services citing the high cost of operating real name accounts.

Huge Profits

Meanwhile, South Korean exchanges have been reporting huge profits for 2017. BTC Korea which operates Bithumb made a profit of $402 million. This means that its profits rose by nearly 80% from the previous year.

The huge profits are not unexpected.

The demand for digital tokens reached fever pitch in 2017 with a good number of cryptocurrencies making astronomical gains.

Leave a Reply

avatar
  Subscribe  
Notify of
close-link

Risk Warning: Investing in digital currencies, stocks, shares and other securities, commodities, currencies and other derivative investment products (e.g. contracts for difference (“CFDs”) is speculative and carries a high level of risk. Each investment is unique and involves unique risks.

CFDs and other derivatives are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how an investment works and whether you can afford to take the high risk of losing your money.

Cryptocurrencies can fluctuate widely in prices and are, therefore, not appropriate for all investors. Trading cryptocurrencies is not supervised by any EU regulatory framework. Past performance does not guarantee future results. Any trading history presented is less than 5 years old unless otherwise stated and may not suffice as a basis for investment decisions. Your capital is at risk.

When trading in stocks your capital is at risk.

Past performance is not an indication of future results. Trading history presented is less than 5 years old unless otherwise stated and may not suffice as a basis for investment decisions. Prices may go down as well as up, prices can fluctuate widely, you may be exposed to currency exchange rate fluctuations and you may lose all of or more than the amount you invest. Investing is not suitable for everyone; ensure that you have fully understood the risks and legalities involved. If you are unsure, seek independent financial, legal, tax and/or accounting advice. This website does not provide investment, financial, legal, tax or accounting advice. Some links are affiliate links. For more information please read our full risk warning and disclaimer.