South Korea has long been at the forefront of Cryptocurrency adoption and has floated the notion of regulating the Cryptocurrency sector. Although this has previously never materialized, many have pointed to regulation as an important step towards preventing major security breaches and hacking attacks.
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South Korea Restriction on Cryptocurrencies
For the first time in HistorySouth Korea is Officially Recognizing Crypto Exchanges as Regulated Banks. The financial authorities of South Korea have finalized their plans to categorize crypto exchanges as an industry called “Crypto Currency Exchange and Brokerage” to enable trading platforms to perform at a large capacity with support from local authorities. The Local financial authorities feared that the regulating the Cryptocurrency market would lead the public to believe that the government has legitimated the Cryptocurrency sector. Consequently, South Korea postponed the regulation of Crypto Currency exchanges. This week, local publications revealed that the government of South Korea has come to a consensus to recognize crypto exchanges as regulated financial businesses, creating a new industry dedicated to Crypto Currency trading platforms.
South Korea Authorities
They have been hesitant in regulating Crypto Currencies, due to their belief that Crypto Currency regulation could lend legitimacy to the sector, and be seen as an official stamp of approval from the government on Crypto Currency investing. Also, the nation’s government has reached a consensus, deciding to recognize Crypto Currency exchanges as regulated financial businesses. This is a significant step for Cryptocurrencies, and will have far-reaching implications.
About South Korea Crypto Market
South Korea is an important segment of the Crypto Currency market, with a lot of Crypto Currency investments, technological developments and large Crypto Currency exchanges established in the country. South Koreans are famous for have a high percentage of Crypto Currency enthusiasts within the population, but the South Korean government is not so keen on Crypto Currencies. The latest South Korea Crypto Currency news concerns a police investigation into Upbit, South Korea’s largest Crypto Currency exchange that had a massive effect on markets on the 11th of May. South Korean Crypto Currency regulations are pretty tough. ICOs are banned and local Crypto Currency exchanges are being shut down or else have found themselves under increased supervision. The South Korean government is concerned about money laundering, tax evasion and excessive speculations. It is a prospective that foresees the continued actions of lawmakers to push forward with new restrictions.
South Korea requires international cooperation on Cryptocurrencies
South Korea, a country that has banned ICOs, plans to loosen restrictions on Crypto Currencies based on efforts by G20 to create uniform regulations.
According to G20 Meeting
The G20 meeting established a July deadline for taking the first step on unified regulations. The decision to regulate the Cryptocurrency sector in this manner and granting them the status of financial institutions will give South Korea’s Financial Services Commission direct authority and control over the CryptoCurrency industry in the country. The regulation will in all probability see the CryptoCurrency industry in South Korea change significantly during the coming months, especially regarding areas such as investor protection.
Important to note- After the G20 summit held in Argentina, the general consensus was to establish a tentative date for starting this work. After discussing the most convenient time frame, the month of July was set as deadline. The security systems to continue operating, something which is impossible for many minor Crypto Currency Exchanges. This regulation also spells the death for smaller Crypto Currency Exchanges. Whilst these have previously been able to obtain a license to operate for a mere $20, they will now have to receive approval from South Korean cybersecurity authorities, as well as the department of financial intelligence.
The government’s thinking about Crypto Currency is called for, although it is unlikely there will be a major change in policy. The country needs to place greater emphasis on Block Chain technology once it gains a better understanding of the “possible flipside” of Crypto Currency trading.