Korea’s cryptocurrency exchange Zeniex has canceled its plan to launch its second cryptocurrency fund.

The cancellation came after the South Korean financial regulator warned that the cryptocurrency fund might violate the Capital Market Law, which mandates all fund management firms to register with the regulator before launching the fund.

A Zeniex spokesman said, “We cancel the launch not to invite misunderstanding from the regulator/.” It said it would fully cooperate with the financial regulator in the future.”

South Korea has banned the initial coin offering. It has firmly traced issuers of cryptocurrencies.

However, Zeniex said it would make efforts to ensure the successful management of its first cryptocurrency fund and to protect the investors.

Zeniex also said it would list its token on foreign cryptocurrency exchanges