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South Korean Universities Face Blockade of Cryptocurrency to Cash Conversion
Last Updated: May 28, 2024 12:32am EDT | 1 minute read
South Korean financial authorities ban universities from opening corporate accounts for coin transactions. This results in their inability to convert cryptocurrency donations provided by some cryptocurrency companies into cash.
This was reported by the local newspaper Chosun Ilbo Financial authorities feared on Monday that corporate accounts, unlike individual accounts with real names attached, could be more easily used for money laundering due to a lack of individual verification.
The Korea Financial Intelligence Unit (KoFIU) and the Ministry of Education will reportedly maintain their position by banning universities from opening corporate accounts for coin transactions.
South Korean Universities Blocked From Cryptocurrency Donations, New Rules Expected
This decision comes after some universities requested to open corporate accounts for cash conversion, following large coin donations received.
A senior financial authorities official explained the decision, saying that allowing universities an exception would be unfair to other businesses. Furthermore, opening such accounts for all companies would create a significant money laundering risk.
Furthermore, financial authorities and the Ministry of Education intend to advise universities to avoid accepting such donations in the future. However, they could offer a lifeline to universities that already hold such donations.
Depending on the amount and other factors, a system may be set up to convert these existing coins into cash. This suggests a possible solution for universities struggling with previously received cryptocurrency donations.
South Korea bans cryptocurrency donations
South Korea recently has slammed the door on cryptocurrency donations. This new policy prohibits charities from accepting digital currencies, potentially impacting their fundraising efforts.
The decision comes despite the growing popularity of Bitcoin (BTC) and other digital currencies in the country.