South Korean lawmakers plan to tighten crypto regulations and toughen the penalties for unethical commercial practices in the sector with a focus on protecting investors in virtual assets, such as digital currencies.
Local media reports that the South Korean Financial Services Commission (FSC) and the National Assembly are working to pass a bill that would allow financial authorities to supervise cryptocurrency exchanges and monitor unfair trade practices like the use of confidential information, price manipulation, and fraud.
While the National Assembly is now considering 14 various proposals related to cryptocurrencies and digital assets, including the ambitious and comprehensive Digital Asset Basic Act, this legislation has an emerging nature and should provide greater investor protection beginning in 2023.
According to what an anonymous National Assembly representative informed the media:
“In the U.S., since the Securities and Exchange Commission (SEC) exercises a wide range of powers, it is possible to punish unfair trade in virtual assets without separate legislation, but in Korea, related legislation is absolutely necessary.”
Although the particular penalties for different types of misconduct are not yet known, it is anticipated that they will be created to synchronize supervision and punishment at a level akin to that of the conventional financial industry.
Do Kwon, a co-founder of Terra, was the subject of an arrest warrant from South Korean police in September. The warrant was later revoked, and Kwon was added to Interpol’s Red Notice list so that law enforcement could find and perhaps jail him. The co-founder of Terra was given a mandate by South Korea’s foreign ministry on October 6 to give up his passport or risk having it revoked.
To stop money laundering attempts utilizing digital assets, the FSC declared at the end of October that it would monitor crypto whales with assets over 100 million won ($70,000).