South Korean cryptocurrency exchanges are further tightening controls on automated trading. The Korea Digital Asset Exchange Alliance (DAXA) has launched a new API key management standard, focusing on combating unauthorized sharing, key lending, and suspected proxy trading. The Financial Supervisory Service of Korea stated that API trading currently accounts for approximately 30% of the trading volume in the South Korean cryptocurrency market.

Suspicious keys can be forcibly invalidated.

DAXA stated that if an exchange suspects a user has lent their API key to a third party or allowed external tools to conduct unusual operations through their account, it can initiate a more stringent handling process. These measures include increasing monitoring intensity, issuing warnings to users, requiring them to re-verify their identity, and even invalidating the API key.

API keys typically connect to functions such as price inquiries, balance readings, order placement, and deposits/withdrawals. If improperly shared, third parties could use these keys to access user accounts, increasing the risk of abnormal transactions and market manipulation.

All five member exchanges will execute simultaneously.

The new standard will apply to DAXA member exchanges, including Upbit, Bithumb, Coinone, Korbit, and Gopax. These platforms cover a major share of the regulated crypto trading market in South Korea.

Member exchanges will also introduce a stricter IP whitelist mechanism. This means that API keys can only be used on IP addresses pre-registered by the user, reducing the possibility of keys being transferred to others and subsequently used to access the account.

This measure does not prohibit API transactions themselves; the focus of the crackdown is on users handing over their keys to others or tacitly allowing third parties to conduct transactions through their accounts.

Regulators continue to focus on automated trading

South Korea's Financial Supervisory Service had previously issued a warning about automated trading, stating that such activities could create false trading volume and distort token prices. The report mentioned that some unusual patterns include repeated small trades, fake orders, and coordinated behavior between multiple accounts. These operations amplify the appearance of market activity.

DAXA's introduction of a unified standard is seen as a direct response to regulatory warnings, and it also provides exchanges with clearer tools to handle abnormal account access.

South Korea has recently tightened its risk control requirements for exchanges. Following the major operational error at Bithumb, regulators have mandated that local exchanges implement balance checks every five minutes, automatic trading suspension mechanisms, and monthly audits.