South Korea passes bill on cryptocurrencies
Friday, June 30th in South Korea accepted digital asset bill to protect investors. Notably, the regulation includes 19 separate laws related to cryptocurrencies. It contains a definition of digital assets and provides for strong sanctions for violations such as the use of confidential information, market manipulation and unfair trading practices.
Under recent legislation, the Financial Services Commission is given the power to oversee cryptocurrency operators and asset custodians. The Bank of Korea also has the right to inspect such platforms. In addition, the law requires the availability of insurance coverage, reserve funds and the necessary documentation. The rules apply to assets such as bitcoin, and existing capital markets legislation applies to tokens that are considered securities.
However, not everything is so smooth. Lee Soo Ryong, secretary general of the Korea Blockchain Enterprise Development Association in Seoul, said the law is “stuck” for now.
“We applaud the efforts of the authorities to ensure order, but in general, the law, like the past, is stuck in the paradigm of traditional finance, which may more suppress the development of the cryptocurrency industry than help it,” he said.
The new set of rules will initially focus on protecting investors and will be gradually expanded to allow for a broader level of oversight, said Baek Hyoryun, chairman of the National Policy Committee in the South Korean Parliament.
According to CCData, monthly crypto trading volume in the South Korean market dropped to about $38 billion in April from almost $200 billion, which was two years ago, before the collapse of Terra. Despite this, the country continues to be known for occasional virtual asset manias.
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