A new set of bills is reportedly being prepared to regulate and legalize cryptocurrencies like Bitcoin and Ethereum in South Korea.
According to a report today by the Korea Herald, representative Park Yong-jin, a lawmaker and member of the country’s ruling Democratic Party is drawing up three revisions this month to build a regulatory framework for digital currencies.
One of the bills will look at revising the existing Electronic Financial Transactions Act in order to mandate regulatory approval for cryptocurrency transactions, according to the report. In effect, this would mean that traders and even companies engaging in cryptocurrency transactions would be under the purview of the South Korean government.
In the draft proposal, Park pointed to “the void of a state-led protection that guarantees digital currency’s value”, citing the need to address “digital currency’s nonexchangability to other existing currencies” and intriguingly, “the possibility of wrecking havoc on national economy from digital currency bubble burst”, according to the report. Park, presumably a skeptic of digital currencies, has notably compared this year’s surging prices of cryptocurrencies with Europe’s tulip craze in the 17th century.
The other revisions also address income and corporate tax laws to enable financial authorities to curb any instances of tax evasion from digital currency transactions. South Korea has consistently figured among the world’s largest bitcoin trading markets this year. Data shows the Korean market amounting to nearly 8.5% of the world’s traded bitcoins in a 24-hour period, with a spread of just under $150 when compared to USD-based markets.
As CCN.com reported in late 2016, the country’s Financial Services Commission (FSC) – the primary financial regulator – established a digital currency task force with the aim of introducing regulations for the digital currency industry this year.
At the time, FSC chairman Yim Jong-yong stated:
The government will push for the systemization of digital currency on a full scale in tandem with a global trend in the U.S., Japan and other countries.
While moves toward regulation and, in effect, legalization were uncertain as recently as June, today’s developments point to a more concrete, legislative path toward that that end.
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Last modified: May 21, 2020 9:43 AM UTC