South Korea’s Financial Oversight Service will lead the government’s efforts to oversee the country’s expanding cryptocurrency market. The agency was hired to do the job after lengthy discussions about which Korean regulator should be responsible for the industry.
Financial regulator takes responsibility for the crypto sector in Korea
It took the government months to determine who will be in charge of the crypto market, the Korean Herald noted in an article published over the weekend. The Seoul executive announced on Friday that the task had been entrusted to the Financial Supervisory Service (FSS), one of the country’s financial regulators.
The agency will closely monitor the implementation of the previously introduced regulatory measures, the newspaper said. This includes the Law on Reporting and Use of Specified Financial Transaction Information. The latter imposes certain restrictions on the cryptocurrency exchanges operating in South Korea.
The Korean government has also given powers to the Ministry of Science and Information and Communication Technology to direct the development of the blockchain industry in the country. The department has already dealt with issues related to the crypto space. In early May, Korean media reported that in the past three months the ministry had found and blocked over 30 phishing websites attempting to obtain credentials from users of the crypto exchange.
South Korean government confirms plan to tax crypto-related profits
In this week’s announcement, the South Korean authorities also maintained their obligation to impose an income tax on profits from cryptocurrency transactions. Crypto investors who earn 25 million won ($ 22,400) or more in the next year will have to pay 20% of their profits. Not all Koreans welcomed the proposal.
Another development concerns crypto trading platforms operating in the Asian country. The Korean government has decided to prohibit cryptocurrency operators from directly participating in the provision of transactions or intermediary services. Korean ministers say the move aims to increase transparency in the operation of digital asset exchanges.
Crypto investing and trading has grown in popularity in South Korea, where prices have often exceeded global rates. The phenomenon known as the “kimchi premium” has been on the rise again in the last few weeks since the markets began to decline. At the time of writing, Bitcoin (BTC) is priced at over $ 38,000 on Bithumb, one of Korea’s largest crypto exchanges, while the global price is closer to $ 35,000.
The recent Seoul decisions add to a number of regulatory announcements that have negatively impacted cryptocurrency markets. The authorities in China are cracking down on Bitcoin miners and have reiterated the previously introduced restrictions on the trading and exchange of cryptocurrencies. In the meantime, the U.S. has announced new measures to curb cryptocurrency tax evasion, including requiring companies to declare all crypto revenues above $ 10,000 of market value.
What do you think of the latest regulatory developments in South Korea? Do share your thoughts on the matter in the comments below.
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