This year, native cryptocurrencies proved to be the biggest cause leading to the failure of a number of cryptocurrency exchanges and ecosystems; the most recent example of this was the collapse of the FTX.

The Korea Financial Intelligence Unit (KoFIU), which is Korea’s authority on financial affairs, took note of the same when it launched an investigation into cryptocurrency exchanges regarding the listing of their own internally created tokens.

The FTX cryptocurrency exchange and its 130 affiliated companies have just filed for bankruptcy as a result of a drop in the price of the FTX token, the company’s in-house token.

A local article states that the purpose of KoFIU’s investigation into the matter is to maintain regulatory compliance for investor protection. This is the case despite the fact that Korean cryptocurrency exchanges are prohibited from releasing native tokens.

Initial examinations indicated that all cryptocurrency exchanges operating within South Korea were in compliance with all applicable laws and regulations.

A representative of the Financial Services Commission (FSC) said that “there are still some uncertainties related” to internal token listings. This prompted the FSC to announce preparations for further investigation.

According to a report by regional media outlet Yonhap, the Flata exchange is one of the main suspects and is now the subject of an investigation since listing its in-house token, FLAT, in January 2020.

Authorities have said that major exchanges like Upbit and Bithumb are no longer under investigation; instead, they would focus their efforts on investigating smaller exchanges.