South Korean cryptocurrency exchange Bithumb has suspended all new accounts following their failure to comply with the South Korean government’s guidelines that require all cryptocurrency exchanges to establish new contracts with their banks.

According to a report from Business Korea, the massive cryptocurrency exchange will stop issuing new accounts starting August 1st, due to failed contract negotiations with NH Nonghyup Bank. Customers who already have registered accounts with Bithumb will still be able to access deposit and withdraw services for the time being.

Bithumb lost its previous banking relationship with Shinhan Bank due to risky practices and failed to secure another banking relationship in the time since. NH Nonghyup discussed why they terminated negotiations with Bithumb, saying:

“We have decided not to renew the contract because Bithumb still has problems in protecting consumers and information and preventing money laundering.”

Their concerns stem from the recent $31 million hack that sparked calls for more government oversight of cryptocurrency exchanges. Bithumb quickly responded to the comments by NH Nonghyup Bank, saying:

“We have a consensus with Nonghyup Bank on renewal of the contract. We are planning to iron out our different views on some legal expressions and start issuing virtual accounts soon.”

Ultimately, the lack of access to deposits and withdraws may force Bithumb to shift their trading services to their collection account called “hive account,” which will be an inconvenience to investors.

The recently introduced regulations required that exchanges ban anonymous virtual accounts and forced the implementation of KYC procedures. Users must now create accounts under their real names that match the name on their bank accounts. In January, the government put in place regulations requiring exchanges to renew banking relationships every six months. The goal of this regulatory measure is to reduce money laundering by increasing the transparency of exchange’s internal practices.

Following the South Korean government’s regulatory actions, Bithumb is the only major cryptocurrency exchange in South Korea that has not yet re-secured banking relationships under the new regulatory terms. Coinone, Upbit, and Korbit have all extended ties with their banks, proving that they have implemented proper procedures that protect investors and prevent money laundering.