South Korea’s Inaugural Digital-Asset Legislation
South Korea recently enacted its first digital-asset legislation, aimed at protecting investor interests and legitimizing cryptocurrency. This comes as cryptocurrency exchanges in the country experience a surge in trading volumes.
Main Breakdowns
– The Virtual Asset User Protection law consolidates 19 crypto-focused bills and provides clear definitions for digital assets. It also enforces penalties for infractions such as insider trading and market manipulation.
– The Financial Services Commission (FSC) and the Bank of Korea are empowered to supervise cryptocurrency operators and custodians, with requirements such as insurance coverage and record keeping.
– Bitcoin falls under the purview of the new regulations, while tokens considered securities will be governed by existing capital markets law.
– The law follows significant challenges in the South Korean cryptocurrency market, including the collapse of tokens and the suspension of withdrawals by digital-asset lenders.
– The new legislation has received mixed reception, with some suggesting it may hinder industry growth.
South Korea’s Journey towards Embracing Cryptocurrency
The enactment of South Korea’s inaugural digital-asset legislation is a significant milestone in the country’s embrace of cryptocurrency within its financial ecosystem. While there are differing opinions on the impact of the new regulations, it marks a step forward in legitimizing and regulating the crypto industry in South Korea.
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