Zeniex Crypto Exchange In South Korea Shuts Down After Government Regulators Move In
A South Korean cryptocurrency exchange had to shut down its operations after a recent government crackdown on unauthorized platforms. The cryptocurrency exchange affected is Zeniex and it will be terminating its services after the decision taken by the government. The information was released by the crypto platform in a blog post back on Friday.
Zeniex entered the market as a joint project between Chinese and South Korean individuals back in May 2018. South Korea experienced a very important growth in the virtual currency market. Due to this situation and the expansion of new platforms and crypto-related services, the government took the decision to regulate the market and ban Initial Coin Offerings (ICOs) from operating in the country.
The whole services at the trading platform will be stopped on November 23rd. Customers have to withdraw all their funds as soon as possible and before the deadline. After Nov. 23, users will not be able to access their funds.
In another announcement made by the company, Zeniex’s cryptocurrency fund known as Zxg Crypto Fund No. 1 will also be closing its operations on November 23. The main intention was to list the ZXG crypto in other international and recognized exchanges all over the world. Nonetheless, the plans had to be suspended.
About it, the company wrote:
“We believe that ZXG Crypto fund No 1. Will have difficulties to operate smoothly with such current pressure from the financial authorities.”
The company will be returning the funds invested by users on Monday, November 12. Back in October, the South Korea Financial Services Commission (FSC) warned investors about investing in unauthorized crypto- and blockchain-related companies such as Initial Coin Offerings or crypto exchanges. The reason behind this warning was that they all fail to protect investors from risks.
According to Business Korea, the virtual currency funds of the company have never been registered in the Financial Supervisory Service (FSS). Additionally, the financial investment guide on their homepage was not audited by the FSS.
Although a total ban on crypto was never implemented by South Korea, some rumors spread regarding this possibility on the internet. In the end, the Asian country took the decision to regulate the space, something that most of the countries around the world are currently trying to do.
The government might take more crypto-friendly regulations if it wants the technology to develop in the country taking care of the investors. Some countries such as Malta are creating very flexible and clear regulatory frameworks for companies to be able to invest, research and expand in the market without leaving investors without any protection.