South Korea Imposes Supervisory Fee on Crypto Operators
South Korea has recently introduced a supervisory fee for crypto operators in the country, based on their operational revenue. The Financial Services Commission (FSC) of South Korea put the new regulation into effect on July 19, requiring local crypto exchanges to pay a regulatory fee of around 300 million won ($220,240).
Regulated Exchanges Required to Comply with New Regulations
According to a local report, regulated exchanges such as Upbit, Bithumb, Coinone, and Gopax must adhere to the supervisory contributions mandated by the FSC. The regulatory fee is designed for inspections by the regulator, as outlined in the revised ‘Enforcement Decree of the Act on the Establishment of the Financial Services Commission’ and the revised ‘Regulations on the Collection of Financial Institution Contributions.’
- The FSC targets crypto exchanges for inspections
- Regulatory contributions based on previous fiscal year revenue
- Korbit exempt from the supervisory fee
Supervisory Fee Resembles a Tax-Like Charge
The contributions from virtual asset operators to the FSC are akin to quasi-taxes that financial institutions pay. These fees enable the regulator to conduct inspections and provide supervision and services to the industry. With the enforcement of the Virtual Asset User Protection Act, FSC inspections are set to commence promptly, ensuring that crypto operators’ supervisory fees are enforced without delay.
- Fee serves as payment for regulatory services
- Inspections to commence swiftly under new Act
- Impact on exchanges facing operating losses
Hot Take: South Korea’s New Crypto Regulatory Landscape
As South Korea moves to regulate its crypto industry more closely, crypto operators in the country are now required to pay a supervisory fee based on their operating revenue. This new fee, resembling a quasi-tax, comes as part of the FSC’s efforts to enhance oversight and compliance within the sector. With the introduction of these regulatory contributions, exchanges like Coinone and Gopax may face additional financial pressures amidst ongoing operational challenges in the market.
Sources:
– Local Report
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