Earlier this week, the South Korean government and its financial regulators scheduled an urgent meeting regarding the country’s booming cryptocurrency industry. The meeting was held on December 12th. The very next day, the South Korean financial regulating authority confirmed that within a few weeks, minors and foreigners will become prohibited from investing in any cryptocurrency available in the country.
In the following week, the South Korean government will likely introduce a brand new set of regulations aimed to protect the investor and address the issue of taxation. Currently, a widely discussed policy, which could be introduced, suggests distributing the daily trading volumes of all crypto exchanges equally throughout the market. In addition, the new regulatory policies will likely include stricter anti-money laundering (AML) and Know Your Customer (KYC) regulations.
South Korea’s biggest crypto exchange, Bithumb has released a statement which confirmed that they welcomed all regulations, as deemed proper by the government. In addition, the exchanges applauded the government’s efforts by noting that the regulations will create a more legitimate, stable, and valid economic trading environment.
The South Korean government was reluctant about introducing regulation on its cryptocurrency industry for several years, as they feared that regulation would be viewed by citizens as a form of endorsement and validation. However, considering the boom of the crypto industry in the past year, South Korean officials have relented. The industry has become too big to be ignored. The South Korean government has recently started taking steps to take their rightful place among other key international players in the crypto industry, such as Japan and the United States.
According to a spokesperson of the South Korean cryptocurrency task force, the government intends to look towards the leaders in the crypto industry when deciding the details of its regulations. While the government is still wary of the negative connotations of the industry, they acknowledge that the market is too beneficial to the general South Korean market to be banned outright.
So far the country’s government, regulatory agencies, and central bank have two main priorities. First, they will prevent minors from participating in the cryptocurrency industry. Second, they will address fraudulent Ponzi-schemes that may arise as the industry continues to progress.
Ever since the price of bitcoin continued to climb throughout all of 2017, everyone has been rushing to get a foot in the door. This includes teenagers and young college students. Earlier this year, reports confirmed that it is commonplace for teenagers and young adults to trade cryptocurrencies in the industry, and frequently check the price trend during and between classes. The South Korean prime minister, Lee Nak-Yeon has already expressed the government's concerns regarding this troubling trend. To address this, the country will impose a ban that will prohibit minors from participating in the market.
In addition, the country has been increasingly falling victim to Ponzi schemes. In November, a Ponzi-scheme was discovered which stole over $200 million by misleading investors with a high return on investments and then stealing their funds.
Despite its high daily trading volumes, the South Korean crypto market is still relatively immature, especially when compared to Japan or the US. Comprehensive regulations could help the South Korean crypto market reach maturity while staying open to innovation.
In the following week, the South Korean government will likely introduce a brand new set of regulations aimed to protect the investor and address the issue of taxation. Currently, a widely discussed policy, which could be introduced, suggests distributing the daily trading volumes of all crypto exchanges equally throughout the market. In addition, the new regulatory policies will likely include stricter anti-money laundering (AML) and Know Your Customer (KYC) regulations.
South Korea’s biggest crypto exchange, Bithumb has released a statement which confirmed that they welcomed all regulations, as deemed proper by the government. In addition, the exchanges applauded the government’s efforts by noting that the regulations will create a more legitimate, stable, and valid economic trading environment.
The South Korean government was reluctant about introducing regulation on its cryptocurrency industry for several years, as they feared that regulation would be viewed by citizens as a form of endorsement and validation. However, considering the boom of the crypto industry in the past year, South Korean officials have relented. The industry has become too big to be ignored. The South Korean government has recently started taking steps to take their rightful place among other key international players in the crypto industry, such as Japan and the United States.
According to a spokesperson of the South Korean cryptocurrency task force, the government intends to look towards the leaders in the crypto industry when deciding the details of its regulations. While the government is still wary of the negative connotations of the industry, they acknowledge that the market is too beneficial to the general South Korean market to be banned outright.
So far the country’s government, regulatory agencies, and central bank have two main priorities. First, they will prevent minors from participating in the cryptocurrency industry. Second, they will address fraudulent Ponzi-schemes that may arise as the industry continues to progress.
Ever since the price of bitcoin continued to climb throughout all of 2017, everyone has been rushing to get a foot in the door. This includes teenagers and young college students. Earlier this year, reports confirmed that it is commonplace for teenagers and young adults to trade cryptocurrencies in the industry, and frequently check the price trend during and between classes. The South Korean prime minister, Lee Nak-Yeon has already expressed the government's concerns regarding this troubling trend. To address this, the country will impose a ban that will prohibit minors from participating in the market.
In addition, the country has been increasingly falling victim to Ponzi schemes. In November, a Ponzi-scheme was discovered which stole over $200 million by misleading investors with a high return on investments and then stealing their funds.
Despite its high daily trading volumes, the South Korean crypto market is still relatively immature, especially when compared to Japan or the US. Comprehensive regulations could help the South Korean crypto market reach maturity while staying open to innovation.