OKX Faces South Korea Probe after Crypto Alliance Allegation

OKX faces investigation in South Korea after blockchain alliance filed report claiming exchange marketed token program without regulatory registration.

Key Insights

  • South Korean crypto alliance DAXA reports OKX to authorities for alleged illegal local marketing
  • Report claims OKX promoted Jumpstart token program to Korean users without proper registration
  • Watchdog expected to investigate OKX over violation of Korean rules on crypto exchange registration

SEOUL (MarketsXplora) – Cryptocurrency exchange OKX is being investigated in South Korea after an industry alliance accused the exchange of improperly promoting its offerings locally without registration, people familiar with the matter said on Wednesday.

The Blockchain & Digital Asset Exchange Alliance (DAXA) filed a report with South Korean authorities alleging that OKX actively marketed its “Jumpstart” crypto token launch program to local traders via Telegram without approval to operate onshore.

OKX, the world’s second-largest crypto bourse by spot trading volumes, could not immediately be reached for comment by MarketsXplora.

Under Korean regulations, foreign exchanges like OKX can only provide services to domestic investors if they have an official presence locally, which requires registration, approval and close oversight.

Promoting platforms or tokens within South Korea without such clearance violates rules aimed at shielding traders from potentially risky assets and volatile markets, DAXA says.

Read also! Crypto.com to Launch Retail Trading Service in South Korea

The alliance of top domestic exchanges told MarketsXplora that marketing regulations are a matter for South Korea’s Financial Intelligence Unit (FIU) as the oversight body, rather than themselves.

“The decision is for the Financial Intelligence Unit to make,” a DAXA spokesperson said, adding it filed the OKX report to assist regulators and was not itself alleging violations.

The FIU is expected to investigate OKX over the marketing activity claims, local media outlet News1 reported on Wednesday, citing an unnamed industry source.

Hong Kong-based OKX offers spot trading for hundreds of tokens like bitcoin as well as futures, options and other derivatives products for institutional and retail investors across various jurisdictions.

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