Earlier today, as South Korean mainstream media outlet Hankyoreh reported, the South Korean government’s planned regulations around bitcoin and the cryptocurrency market have been leaked. Translated at CCN, the four leaked regulations expected to be implemented by the end of this year are: Prevent unaccredited…
Earlier today, as South Korean mainstream media outlet Hankyoreh reported, the South Korean government’s planned regulations around bitcoin and the cryptocurrency market have been leaked.
Translated at CCN, the four leaked regulations expected to be implemented by the end of this year are:
Contrary to many reports that were released this week, the South Korean government is not banning or cracking down on cryptocurrency trading. It has directly refuted those claims with the newly introduced regulations.
As CCN previously reported, the South Korean government was hesitant in imposing cryptocurrency-related regulatory frameworks over the past 12 months because it believed strict regulations would further legitimize, stabilize, and validate the local cryptocurrency market.
But, the South Korean government has started to rush the imposition of regulations for the local cryptocurrency market because of its sheer rate of growth. The regulations that were leaked earlier today were formed on Wednesday, during the emergency meeting the South Korean government had held.
The focus of the South Korean government and its cryptocurrency task force formed by the South Korean Ministry of Strategy and Finance, Financial Services Commission, Ministry of Justice, Fair Trade Commission, and Financial Supervisory Commission is to protect casual and individual investors from high volatility.
In the upcoming weeks, South Korean cryptocurrency exchanges may be required by the government to receive approval from local financial authorities to list new cryptocurrencies, especially digital currencies with premature markets and that relatively new.
In the short-term excessive regulations on preventing underaged investors and institutional traders from investing in bitcoin could negatively affect the price trend and demand for cryptocurrencies in the South Korean market.
However, in the long-term, the imposition of regulations by the South Korean market will significantly benefit local investors and businesses, as for the first time in history, the South Korean government has provided clarity in regards to bitcoin and cryptocurrencies.
Essentially, the South Korean government has approved and recognized bitcoin and cryptocurrencies as a new and major asset class, and intends to regulate exchanges as legitimate financial service providers.
A spokesperson of the South Korean cryptocurrency task force has also stated that in the future, the government will follow the regulatory roadmap established by leading regions like Japan and the US.
“The South Korean government has no other choice but to follow the regulatory frameworks and trends established by other leading governments. While there certainly exists a negative reputation attached to the cryptocurrencies, the government’s stance is to allow what has to be allowed, for the benefit of the South Korean market,” said the spokesperson.
Hence, over time, the South Korean government will ease the regulations on cryptocurrency exchanges and investors.
Featured image from Shutterstock.
Last modified: January 24, 2020 11:21 PM UTC