South Korea’s financial regulatory authorities are currently working on developing new regulations for the virtual asset market. These regulations will cover listing procedures, internal controls, and the issuance and circulation volume of virtual assets. The new rules are expected to be announced in January of next year after a thorough research service commissioned by the National Assembly.
The Financial Supervisory Service (FSS) has submitted a business report to the National Assembly Political Affairs Committee, stating their goal of establishing a “virtual asset market supervision and inspection system.” The FSS also intends to support the establishment of standards for virtual asset listing processes, internal control, and issuance and circulation. These efforts aim to address concerns from the National Assembly regarding the implementation of the Virtual Asset User Protection Act.
The Virtual Asset User Protection Act includes regulations on customer deposit custody rules and unfair trade practices for virtual asset service providers. While it focuses on protecting users, it fails to fully address the basic rules needed by the virtual asset industry. In response to a request from the National Assembly, both the Financial Services Commission (FSC) and FSS will review and report on additional necessary virtual asset regulatory systems.
The deadline for this report is set before July 19 of the upcoming year, aligning with the enforcement date of the law. The review items include resolving conflicts of interest in the issuance and distribution process, establishing a regulatory system for stablecoins, and virtual asset evaluation. The outline of the virtual asset regulatory system, including standards on issuance and circulation, is expected to be unveiled in January when research analyzing dissenting opinions from the National Assembly concludes.
The FSS expressed its commitment to implementing the Virtual Asset User Protection Act and other related laws. They aim to create a foundation for a healthy virtual asset market and have plans to collaborate with industry partners in establishing guidelines for virtual asset listing and investigating unfair trading practices.
Hot Take: South Korea Developing New Regulations for Virtual Asset Market
South Korea is taking steps to develop new regulations for the virtual asset market. The Financial Supervisory Service (FSS) is working on establishing a virtual asset market supervision and inspection system. The goal is to address concerns and dissenting opinions from the National Assembly regarding the implementation of the Virtual Asset User Protection Act.
The new regulations will cover listing procedures, internal controls, and the issuance and circulation volume of virtual assets. The FSS aims to create a healthy virtual asset market and collaborate with industry partners to establish guidelines for virtual asset listing and investigate unfair trading practices.
These developments highlight South Korea’s commitment to responsible innovation in the financial industry and ensuring user protection in the virtual asset market. It will be interesting to see how these new regulations shape the future of the virtual asset industry in South Korea.
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