PayProtocol, the South Korean issuer of payments-focused cryptocurrency Paycoin, will reapply for a local license in order to stay in business after the financial authority ordered the suspension of its business.
Paycoin, which was developed under Danal Fintech Corp and launched in 2019, is one of the most used payment tokens in South Korea and is accepted by Pizza Hut, Burger King, 7-Eleven and Park Seung Chol Hair-Studio among others.
On January 6th, 2023, South Korea’s Financial Intelligence Unit (FIU) rejected PayProtcol’s application to register as a provider of crypto trading services due to not having a banking partner as mandated by local laws.
PayProtocol had registered itself as a digital asset wallet provider last year but the financial authorities requested it to register as a crypto trading platform as the FIU interpreted Paycoin transactions as an indirect exchange of crypto and fiat.
PayProtocol told local media that the regulators requested the project to secure a bank partnership five months after it submitted its application in May last year and that the project only had two months to seek a new deal.
The company was ordered to shut down its services and notify its users by February 5th but requested a deadline extension which was not approved by the FIU.
Following the FIU announcement, five fully licensed crypto exchanges in South Korea have marked Paycoin as a cautionary investment.
