Korea’s new stance on cryptocurrencies and their regulation


After coming hard on cryptos, Korea has now changed its rigid position on regulation of cryptocurrencies. The Korean financial regulator came with a statement today that the government will support “normal transactions” of digital currencies, just only three weeks of banning trading through anonymous bank accounts.

The statement was made by Choe Jeung-sik, the governor of the Financial Supervisory Service, whose new position made many to question where Korea stands at when it comes to blockchain, digital currencies and innovation.

What happened on January 30th, less than a month ago, was that Korea issued a real-name trading system for all digital currencies transactions. The country said that their major issue with cryptos is the deregulation and the unknown purpose of cryptos, which could include money laundering, terrorism financing and other.

Since Korea is a major player when it comes to volume of cryptos traded, the real-name trading system essentially decreased speculative investment in coins.

As reported by Korean Joongang Daily, Choe recently held a meeting with representatives from cryptocurrency exchanges during which he said the government “will support [cryptocurrency trading] if normal transactions are made.”

Currently, local banks have been reportedly reluctant to open virtual accounts for cryptocurrency trading amid the government’s crackdown.

Choe said the government will “encourage” banks to make transactions with cryptocurrency exchanges.

Just like most countries, the cryptocurrency market is not yet recognized as a financial product and banks have no regulations regarding it basically. While many banks report the trading of crypto is “frowned upon”, they do not have the legal right to stop it, in most countries.

 

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Korea's new stance on cryptocurrencies and their regulation

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