South Korea’s regulations prohibiting corporations from opening virtual asset exchange accounts are making it impossible for local universities to liquidate their large cryptocurrency donations. Financial authorities cite money laundering concerns as the reason for maintaining the ban.
Education Ministry and Financial Intelligence Unit Favor Maintaining Ban
South Korean universities are reportedly unable to convert cryptocurrency donations into cash due to regulatory restrictions imposed by the country’s financial authorities. These restrictions prevent learning institutions from opening corporate accounts for handling such assets. An intelligence unit within the Financial Services Commission (FSC) and South Korea’s Education Ministry support maintaining this ban.
According to a report by Chosun Daily, Korean financial authorities have advised banks not to issue virtual asset exchange accounts to corporations and institutions. The rationale behind this decision is the perceived higher risk of money laundering associated with extending this privilege to corporate entities.
Despite receiving substantial cryptocurrency donations, some universities have requested exemptions from this requirement. However, an unnamed Korean official maintains that institutions, including universities, should not be treated differently.
“Allowing it only for universities would create issues of fairness with other corporations, and permitting it for all corporations would pose too high a risk of money laundering,” the official argued.
The report also suggests that the ease with which one establishes and dissolves a corporation could be one of the reasons why authorities are reluctant to lift the ban.
Meanwhile, the report claims that Korean authorities may consider a one-time exception to allow universities to cash out donations already received. However, authorities also plan on advising universities against accepting such donations in the future.
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Source: Bitcoin
