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| The head office of Upbit in Seoul / Yonhap |
By Yoon Ja-young
Dunamu, the operator of the country's leading cryptocurrency exchange, Upbit, has expanded trading restrictions to family members of its executives and staff as a preemptive measure to enhance ethical management. The decision is drawing attention as the internal control system, which is on par with that of the traditional financial industry, is expected to enhance the overall level of trust in the relatively new industry.
According to crypto industry sources, Dunamu has been restricting cryptocurrency trading by the family members of its executives and staff since August. The restriction was previously imposed only on executives and staff themselves, but Dunamu expanded it to their families to fulfill its social responsibility.
Back in September of 2021, the government revised the law to restrict cryptocurrency trading by crypto businesses and their executives and staff to enhance transparency as well as prevent damage to users by price manipulation by those businesses.
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| Logo of Dunamu / Korea Times file |
The internal control policy in the cryptocurrency market is receiving attention as there is no daily price restriction, unlike the stock market. An irregular trade using inside information can thus greatly damage trust in the market. Hence, most cryptocurrency exchanges in the country are equipped with internal rules to prevent irregular trading by executives and staff, restricting them from using their own trading services.
Dunamu went a step further by partly restricting trading via other exchanges as well. Dunamu executives and employees can trade via other exchanges in only the top 12 cryptocurrencies in terms of market cap, and their annual purchase of the coins should not exceed 100 million won. They should also report their trading each quarter.
Dunamu said it expanded the internal control to family members as a part of sustainable ethical management.
"We came to strengthen the regulation since August to be commensurate with our status as the most trusted digital asset exchange that meets global standards," a spokesperson for Dunamu said.
Industry experts say that such preemptive internal controls will positively affect the overall crypto industry.
"The trading restriction on family members will help the market gain trust. It will have a positive impact," said Kim Hyoung-joong, a professor at Korea University School of Cybersecurity.
