Identity checks on crypto exchanges at risk as AI deepfakes evolve

South Korean authorities are reportedly looking into blocking crypto exchange platforms that may have operated without adhering to the requirements set by the country’s financial regulator. On March 21, local media Hankyung reported that the Financial Intelligence Unit (FIU) of the Financial Services Commission is considering sanctions against crypto exchanges for allegedly operating in the country without reporting as an operator to the appropriate regulators. South Korean financial authorities require crypto exchanges to report to regulators as virtual asset service providers (VASPs) under the country’s Specified Financial Information Act. The FIU is investigating a list of exchanges and is conducting consultations with related agencies. The regulator is also considering sanctions, such as blocking access to the exchanges, as they begin to prepare countermeasures. Exchanges operated without VASP reportsThe list of exchanges that have allegedly provided services to South Koreans without the appropriate VASP reports includes BitMEX, KuCoin, CoinW, Bitunix and KCEX. The exchanges reportedly provided marketing and customer support to Korean investors without going through the country’s compliance process. Under the country’s laws, operators of crypto sales, storage, brokerage and management are required to report to the FIU. If exchanges don’t comply, their business will be considered illegal and subject to criminal penalties and administrative sanctions. An FIU official said in the report that measures to block access to the exchanges included in the list are being reviewed. The official said the financial regulator is currently consulting with the Korea Communications Standards Commission, the regulator in charge of the internet, on how they can block access to the exchanges. Related: Wemix denies cover-up amid delayed $6.2M bridge hack announcementSouth Korean exchanges face scrutiny Apart from foreign exchanges, South Korean crypto exchanges are also facing scrutiny over suspicions and rumors of financial misconduct. On March 20, prosecutors raided Bithumb following suspicions that its former CEO, Kim Dae-sik, embezzled company funds to purchase an apartment. The authorities suspect that the exchange and its executive may have violated some financial laws during the apartment purchase. However, Bithumb responded that Kim had already taken a loan to repay the funds. In addition, rumors of intermediaries getting paid to list projects on Bithumb and Upbit surfaced. Citing anonymous sources, Wu Blockchain said projects claimed to have paid intermediaries millions to get listed on the exchanges. Upbit responded, demanding the media outlet to disclose the list of digital asset projects that paid brokerage fees. Magazine: Crypto fans are obsessed with longevity and biohacking: Here’s why

Australia’s government, under its ruling center-left Labor Party, has proposed a new crypto framework regulating exchanges under existing financial services laws and has promised to tackle debanking.It comes ahead of a federal election slated to be held on or before May 17, which current polling shows is shaping up to a dead heat between Prime Minister Anthony Albanese’s Labor and the opposing Coalition led by Peter Dutton.The Treasury Department said in a March 21 statement that crypto exchanges, custody services and some brokerage firms that trade or store crypto will come under the new laws.The regime imposes similar compliance requirements as other financial services in the country, such as following rules safeguarding customer assets, obtaining an Australian Financial Services Licence and meeting minimum capital requirements.Australia’s Treasury says its new crypto regulations have four priorities. Source: Australian Department of the TreasuryIn August 2022, the government initiated a series of industry consultations to draft a crypto regulatory framework.“Our legislative reforms will extend existing financial services laws to key digital asset platforms, but not to all of the digital asset ecosystem,” the Treasury said in its statement.Small-scale and startup platforms that don’t meet specific size thresholds will be exempt, along with firms that develop blockchain-related software or create digital assets that aren’t financial products.Payment stablecoins will be treated as a type of stored-value facility under the Government’s Payments Licensing Reforms; however, some stablecoins and wrapped tokens will be exempt.“Dealing or secondary market trading in these products will be not treated as a dealing activity, and platforms where they are traded will not be treated as operating a market simply because of that trading activity,” the Treasury said.As part of its crypto agenda, Albanese’s government has also promised to work with Australia’s four largest banks to better understand the extent and nature of de-banking.There will also be a review into a central bank digital currency and an Enhanced Regulatory Sandbox in 2025, allowing businesses to test new financial products without needing a license.Related: May election could open floodgates to institutional crypto: OKX Australia CEOAlbanese’s government intends to release a draft of the legislation for public consultation. However, a change of government could be on the horizon with a looming federal election, a date for which is yet to be called.Dutton’s center-right Coalition had earlier promised to prioritize crypto regulation if it wins the election.The latest YouGov poll published on March 20 shows the Coalition and Labor neck in neck for a two-party preferred vote.The Coalition leads for topline voting intention, while Albanese continues to lead as preferred prime minister. Source: YouGovCaroline Bowler, the CEO of local crypto exchange BTC Markets, said in a statement shared with Cointelegraph that the areas of reform are sensible and would keep Australia competitive with global peers.However, she thinks there “will be additional detail required on capital adequacy and custody requirements.”“We need to ensure that these requirements aren’t overly burdensome for business investment in Australia,” Bowler said. Kraken Australia’s managing director, Jonathon Miller, said there is an “urgent need for bespoke crypto legislation” to address the existing confusion and uncertainty in the country’s industry.“We believe that by establishing a clear crypto regulatory framework and mitigating problems like debanking, government can remove the barriers hampering growth in the Australian economy,” he said. Magazine: Elon Musk’s plan to run government on blockchain faces uphill battle

Bitcoin (BTC) price rallied to an intraday high of $87,453 in the early hours of the NY trading session but quickly retraced its gains to $83,655 shortly after US President Donald Trump made a video appearance at the Digital Asset Summit in New York. Prior to the video statement, rumors circulated on X, suggesting that President Trump would announce zero capital gains taxes on certain cryptocurrencies or issue a favorable statement about the US strategic Bitcoin reserve. To the disappointment of some traders, neither rumor proved to be true, and Trump simply doubled down on his promise not to sell Bitcoin that has been confiscated by the government, and he called for Congress to enact clear stablecoin legislation as soon as possible. The most positive statement made by President Trump was his restated goal of making the US the leader in all things crypto. “Together, we will make America the undisputed Bitcoin superpower and the crypto capital of the world.” As is commonplace for crypto markets, traders clearly bought into the rumor that Trump would make some sort of pro-Bitcoin executive order statements, and once this was clearly not the case, they sold on the news. In an X post, chartered market technician Aksel Kibar said that there is still a chance of Bitcoin price correcting to $73,700. BTC/USD 1-day chart. Source: Aksel Kibar / X Kibar said, “Long-term chart on BTC/USD. Still looks like a pullback to the broken $73.7K. What follows from here will decide on the following several month’s price action.” Not all of Bitcoin’s recent strength is attributed to excitement over today’s Trump statement. On March 19, BTC responded positively to the release of FOMC minutes and Federal Reserve Chair Jerome Powell’s confirmation that the Fed’s quantitative tightening regime would reduce its pace and that the possibility of two interest rate cuts in 2025 remained on the table. BitMEX co-founder Arthur Hayes took a victory lap at what he described as the Fed’s admission that QT would essentially end on April 1, but he cautioned that while $77,000 may have been the Bitcoin price bottom, surprise bouts of volatility could lead to more pain in stocks and BTC. Hayes said, “JAYPOW delivered, QT basically over Apr. 1. The next thing we need to gt bulled up for realz is either SLR exemption and or a restart of QE. Was BTC $77K the bottom, prob. But stonks prob have more pain left to fully convert Jay to team Trump so stay nimble and cashed up.” Related: Trump says US will be ‘Bitcoin superpower’ as BTC price breaks 4-month downtrendAs reported by Cointelegraph, a majority of Bitcoin’s recent price action has been driven by activity in the futures markets, but the reappearance of the BTC Coinbase premium could be a sign that spot demand is returning to the market. Bitcoin Coinbase premium index. Source: CryptoQuantThis article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.