October 30, 2024

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The rise comes as minor cryptocurrency exchanges have been using opaque accounts, called “beehive accounts” here, to lure investors. Such accounts enable cryptocurrency exchanges to manage investors‘ money with their corporate bank accounts.

In January last year, Korea began a real-name trading system for cryptocurrencies, banning the use of anonymous bank accounts in transactions to prevent virtual coins being used for money laundering and other illegal activities.

But such opaque accounts allow investors to buy or sell cryptocurrencies by circumventing the real-name trading system.

The government had proposed a guideline to ban such accounts, but a court ruled that it was inappropriate for the government to order cryptocurrency exchanges to shut down their corporate accounts.

While the nation’s fever for cryptocurrency trading has fallen off, cryptocurrency exchanges have become more vulnerable to cyberattacks and fraud. 

By Ram Garikipati and newswires (ram@heraldcorp.com)