South Korea is establishing plans to regulate virtual assets with the launch of the second phase of the Legislation Research.
South Korean financial officials are allegedly getting ready to launch a research project for the second phase of the nation’s virtual asset legislation in an effort to improve rules further and protect users in the cryptocurrency market.
The “Virtual Asset Protection Act,” recently approved by the South Korean parliament, has set the stage for improved user safety and the control of unfair business activities in the cryptocurrency sector.
Now, the emphasis is on addressing difficulties connected to funding and issuing virtual assets through initial coin offers (ICOs), which will supplement these regulations.
The Financial Services Commission (FSC) has verified that a Joint Task Force on Digital Assets meeting was held on July 3 and that the agenda for the second stage of South Korea’s crypto legislation was discussed at that meeting, according to the Korean-language business news portal Chosun Biz.
During a plenary session of the South Korean parliament in June, the first measure about virtual assets was successfully enacted. It includes rules for the protection of user assets, the control of unfair trading practices, and the supervision and sanctioning of market operators.
Legislators asked the FSC to conduct a study to address conflicts of interest brought on by the issue and distribution of crypto assets, nevertheless realizing the need for additional laws.
The FSC intends to order a research service for the second stage of legislation as early as this month, with completion anticipated by August at the latest.
The research service will cover important topics like resolving conflicts of interest, establishing stablecoin regulations, establishing a regulatory system for firms that assess and provide advice on virtual assets, and creating a uniform standard for the distribution and issuance of virtual assets.
Chosun Biz reports that questions have been raised about how the current legal framework would be applied to businesses that handle and deposit virtual assets.
Due to its ambiguity, several digital asset managers, such Haru Invest and Delio, were able to avoid following the rules, which has led to recent issues with deposits and withdrawals.
Therefore, the Financial Services Commission will choose whether to impose enforcement decrees on depository and operating businesses.
