Korea Passes Financial Reporting Amendment and Cryptocurrency Law

South Korean lawmakers voted on Thursday to tighten new rules on cryptocurrency exchanges.This could lead to future market integration while also bringing legitimacy to the country's large crypto industry.

This bill is an amendment to the financial law in force in South Korea, which provides for financial protection (AML) and the prevention of financial fraud. Virtual Resource Providers (VASP), UN CoinDesk Korea (CFT) regulatory framework have been announced.

The law requires all VASPs to register with the governing body and work with a single bank for deposits and withdrawals. This creates a connection between the virtual wallet and the real bank so that administrators can easily track the movement of illegal funds. Both must be registered under their real names.

Additionally, VASPs must be certified by the Korea Office of Safety & Security, which is a lengthy and expensive process that only applies to companies and exchanges.

According to CoinDesk Korea, this could be a small continuation of Korea's policy of economic expansion.Cryptocurrency exchanges can be started by mergers and acquisitions to create funds to replace the new rules.

This could spell the end for investors who must comply with the new registration rules, especially for gray campaigns seeking to defraud their ICOs (the first coin begins).

“If this bill goes through South Korea, blockchain and cryptocurrencies will be excluded and regulated, but will also be allowed to operate in South Korea. This is bad news for fraud. attract ICO projects and exchanges.

Nam Doo-wan

The law is a further example of a national effort to follow new international AML and CFT guidelines in the area of ​​virtual assets.Since the Federal Reserve (FATF) released its regulatory information on VASPs, national regulators have been implicated in illegal activity in their respective territories.

The President of the Republic of Korea must sign the amendment within 15 days. Some of these policies are valid for one year after signing, and all policies can take effect six months after signing.