South Korean Bankruptcy Court Judge Urges Government to Strengthen Crypto Regulation
A judge from the Seoul Bankruptcy Court in South Korea has published a paper calling for increased regulation in the crypto industry to protect investors. The judge, Lee Seok-jun, argued that current regulations are insufficient and highlighted the need for rules regarding market entry, business activities, and disclosure. Lee’s paper analyzed previous court cases related to cryptocurrencies and found that judges often had to make decisions based on their own interpretations due to a lack of legislation. The judge also noted that the Virtual Asset User Protection Act, which will come into effect in July 2024, will introduce some changes but emphasized that further regulation is necessary.
The Need for Stronger Regulation
Lee used a case involving a group of trading platform customers who were unable to sell their coins during a power outage as an example of why more regulation is needed. The customers attempted to sue a crypto exchange but were initially told they would only receive compensation if they could prove their intention to sell coins during the outage. The judge argued that the new law does not adequately address compensation-related matters and expressed concerns about individual courts’ interpretations. Lee also highlighted the disparity between regulations for securities and cryptocurrencies, stating that securities providers have more obligations to protect investors.
Hot Take: South Korea’s Crypto Industry Calls for Enhanced Investor Protection
A bankruptcy court judge in South Korea has urged the government to strengthen regulations in the crypto industry to provide better protection for investors. The judge’s paper analyzed past court cases related to cryptocurrencies and found that a lack of legislation led judges to create precedents through court rulings. The judge emphasized the need for regulations on market entry, business activities, and disclosure in the crypto sector. While new legislation will come into effect in July, the judge argued that more regulation is still necessary. The judge also highlighted the disparity between regulations for securities and cryptocurrencies, calling for similar protections for crypto investors.
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