Crypto Exchange In South Korea Delisting Litecoin For Violating The Financial Transaction Law

Litecoin is considered to have violated the Financial Transactions Act in South Korea. (photo: doc\. pixabay)

JAKARTA - South Korea's major cryptocurrency exchange has phased out Litecoin (LTC) weeks after marking its privacy-focused MimbleWimble (MWEB) upgrade.

In a public announcement on Wednesday, June 8, Upbit cited the Act on the Reporting and Use of Certain Financial Transaction Information, which prohibits anonymous transactions as the main reason for ending support for LTC.

The delisting was carried out in connection with the highly anticipated MWEB update which made LTC transactions private, and concealed several key identifiers. The upgrade was released earlier this year, nearly two years after the first proposal.

The crypto exchange reached out to the Litecoin Foundation to understand the privacy-focused improvements, and after a thorough review, the exchange decided to end support for LTC transactions. Exchange users have 30 days to withdraw their LTC funds.

"We decided to discontinue transaction support for Litecoin (LTC), as it was determined that the optional function that does not expose transaction information included in this network upgrade complies with the anonymous transmission technology under the Special Financial Information Act," Upbit said in its official report, as quoted by Cointelegraph.

According to a report from 8BTC, five major crypto exchanges, namely, Upbit, Bithumb, Coinone, Korbit and Gopax, have now removed LTC from their platforms.

Upbit and other major crypto exchanges issued warnings to investors in the last week of May, informing them of the regulatory risks associated with confidential transactions.

South Korea has some of the strictest crypto regulations worldwide, and the Special Financial Information Act is one of them. Under the rules, crypto exchanges are required to enforce strict Know Your Customer and Anti-Money Laundering policies, and anonymous transactions are prohibited.

LTC delisting is highly anticipated especially after the warning from the stock exchange earlier this year. The Korean exchange has removed several other privacy coins in the past as well.