South Korea has ended 2018 with 6 bills aimed at regulating the Crypto sector according to the country’s top financial regulator. The Financial Services Commission (FSC) has revealed that most of the bills that have been submitted to the National Assembly seek to protect investors in the Crypto sector and ensure Cryptocurrency transactions are safe and reliable. According to the regulator, FSC has not submitted any bill.
User Protection Common In Most Bills
All though all the bills are different and unique in their own ways, they include clauses that seek to protect the users. According to the agencies, these proposals contain clauses such as disclosure requirements, use of nonpublic information, market manipulation, and damage compensation among others. These proposals will reduce the risks involved in investing in the Crypto sector and encourage more people to join.
In January, the South Korean government implemented the real-name system. However, the government has not provided any updates with regard to the program. Since September 2017, initial coin offerings (ICOs) have remained illegal in the country. The introduction of more regulations in the sector may see the government lift the ban in the near future.
Electronic Financial Transactions Act Amendment
According to the FSC spokesperson, the first Crypto bill seeks to amend the Electronic Financial Transactions Act. The law was introduced by Park Yong-jin in July 2017. The new proposal claims that investors have continued to lose their funds even with this act in place.
The new bill also raises concern with the lack of clear definition for virtual currencies and regulations for Cryptocurrencies in the current law. Consequently, the new bill proposes definitions for virtual currency, virtual currency management business, virtual currency issuer, virtual currency brokerage business, and virtual currency handling business. The proposal also recommends the introduction of some measures such as restricting transaction methods with the aim of protecting Cryptocurrency users.
Getting FSC Approval
In February, two bills were submitted to the parliament. According to Yonhap News Agency, the first bill by parliamentarian Jung Tae-ok recommends the creation of a Cryptocurrency exchange system to protect investors and guarantee freedom to business. According to the Korean government’s website, the bill not only defines but also proposes the responsibilities for entities in the Crypto sector. The bill proposes virtual currency account management business or virtual currency trading business to be registered by the FSC.
The other proposal by lawmaker Jung Byung-guk recommends the regulation of Cryptocurrency transactions. The bill also proposes the registration of all people running Cryptocurrency transfer business including management, brokerage, and trading by FSC.
Rep. Je Youn-kyung from the Democratic Party has submitted the Reporting and Utilization of Specified Financial Transaction Information Act to the National Assembly.
Protection Of Virtual Currency Owners
In September, lawmaker Ha Tae-keung submitted a bill that seeks to amend the Electronic Financial Transactions Act. According to the bill, all those involved in the issuance, management, exchange, brokerage, sale, and purchase of virtual currencies should get approval from the FSC.
In November, the National Assembly received the sixth bill by lawmaker Kim Sun-dong. The Digital Asset Trade Promotion Act proposes the protection of the rights of Cryptocurrency users. The bill aims at ensuring the safety and reliability of Cryptocurrency transactions in the country.