South Korea’s Financial Intelligence Unit (FIU) is reportedly probing OKX following allegations that the company is operating as an unregistered cryptocurrency exchange.
According to a February 7 report from South Korean news agency News1, the Digital Asset Exchange Association (DAXA) has flagged OKX’s activities to the FIU, triggering an investigation into the exchange. In December 2023, DAXA and FIU solicited requests from cryptocurrency users in South Korea to provide any information about unlicensed cryptocurrency exchanges operating domestically.
OKX, formerly known as OKEx, is accused of advertising its “Jumpstart” token platform to investors based in South Korea without proper registration, despite not having a Korean-language website. News1 reports that the exchange is alleged to have utilized influencers in South Korea on Telegram to promote its services.
Under South Korean regulations, exchanges must register before providing cryptocurrency services to residents. Failure to register could result in penalties from the country’s financial regulatory authorities.
On January 23, the price of OKX’s token, OKB, plummeted approximately 48% from $46.80 to $25.10 within minutes. The flash crash wiped out $6.5 billion in market capitalization before recovering. At the time of writing, OKB is priced at $48.16.