Possible South Korean Regulatory Changes

It seems as if a number of regulators across the globe are getting involved in the crypto currency markets. They are actively trying to regulate a form of financing that they view as stepping on their toes.

Just a day ago, we learned that China will ban ICOs in it's territory. This was a joint decision amoung 7 of the country's agencies.

Now it looks as if the South Korean authorities are also getting involved. It has been reported that they are looking to strengthen regulations. This issue was raised at a joint meeting with digital currency businesses as well as the regulators such as the Korea Fair Trade Commission (KFTC) and the National Tax Service (NTS).

What was discussed was issues around suspicious transaction reporting by the banks as well as user authentication procedures at the various exchanges. They would also like consumer protection measures in place at the exchanges. Proposals also included the monitoring of petty remittance service providers who use the digital currencies to facilitate their business.

Of more immediate importance though is the implication that they could follow the Chinese and ban Initial Coin Offerings as they view it as a potential violation of the capital market act. Kim Yong-beom, who is the secretary general of the FSC stated that

At this point, digital currencies cannot be considered money and currency not financial products.

They will also attempt to examine the security protocol at a number of these exchanges to make sure that sensitive financial data is not suscepitable to hacker data breaches. This is particularly relevant given recent hacks of South Korean exchanges by North Korean state actors. Other topics that were broached were issues around the taxation and permissions of the digital currencies. They claimed that they will come up with "counter plans" to address these particular issues.

This is all been done when at the same time, South Korean lawmakers are busy trying to pass legislation that would take steps to legalize trading in virtual currencies such as Bitcoin and Ethereum.