South Korea Regulation

Friday, 15 December 2017 12:04

South Korea’s government released emergency measures for cryptocurrency regulation on Thursday. Bitcoin exchanges will now be regulated. Among other measures, there will be a ban on banks, minors, and foreigners trading cryptocurrency as well as a clampdown on virtual bank accounts needed to trade cryptocurrencies in Korea.

Regulating Crypto Exchanges

"A virtual currency exchange, which has more than 10 billion won in sales such as Bithumb, Coinone and Korbit, or more than 1 million visitors per day, is expected to receive the government’s ‘Information Security Management System (ISMS)’ certification next year."

The regulators have also increased the standard and penalties applicable when a security breach occurs at exchanges. “We will not allow virtual currency transactions unless the requirements for protection of investors, transparency of transactions and other measures are met through prompt legislation in the near future,” the government was quoted by the publication.

This week, news.Bitcoin.com reported on the regulators proposing six conditions for crypto exchanges to operate.

A ban on banks, minors & foreigners

The measures contain some prohibitions. News.Bitcoin.com reported on Wednesday of the government’s plan to impose a ban on banks from engaging in any cryptocurrency activities. Hankyung confirmed:

"The government also decided to ban financial companies from buying, securing, and investing in virtual currency."

The measures also impose a ban on foreigners and minors. “Foreigners who are not residing in Korea or minors including high school students will not be able to open an account for virtual currency transactions in Korea,” the news outlet detailed. Moreover, those who already own cryptocurrencies will not be able to make additional trades.

As for a blanket ban suggested by the Ministry of Justice, the news outlet noted that “the ban, which has been reviewed by the Ministry of Justice, has not been adopted at the meeting. It was reported that the government was worried that if all transactions were banned, there would be controversy over infringement of private property.”

Crime reporting trends & taxation

The government also decided to strengthen the crackdown and punishment of cryptocurrency related crimes, including the investment and recruitment of multi-level sales, fictitious coin sales, and illicit transactions. In addition, the news outlet conveyed:

"The police are planning to conduct a special crackdown on ‘hacking and personal information infringement cases’ related to virtual currency, as well as investigating the actual conditions of virtual currency transaction refunds."

The Financial Services Commission (FCC), the Financial Supervisory Service (FSS), and the Korea Exchange will be monitoring cryptocurrency trading trends as well as “abnormal trading of virtual currency related stocks,” the publication noted.

As for taxation, the government announced that it will examine the issue by forming a task force with private experts and related organizations such as the Ministry of Strategy and Finance and the National Tax Service. News.Bitcoin.com recently reported on the government planning to tax bitcoin use as well as get user data from exchanges.

Source: Bitcoin News

Read 246 times Last modified on Friday, 22 December 2017 08:43
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