Recently, South Korea’s Financial Supervisory Service (FSS) has announced its plans to tighten oversight of crypto trading platforms under its jurisdiction in order to eliminate fraudulent transactions. This move comes as part of the country’s efforts to establish a more secure and transparent environment for cryptocurrency trading.
In a notice released on July 4, the FSS stated that local exchanges will be required to establish a “continuous monitoring system for unfair transactions” and report any “abnormal transactions” through a dedicated transmission line. This new requirement aims to ensure that virtual asset exchanges can fulfill their legal obligations smoothly.
The new system is set to go live on July 19, coinciding with the implementation of South Korea’s first regulatory framework for crypto investor protection, known as the Virtual Asset User Protection Act.
Addressing Delisting Concerns
In response to fears of possible mass delistings of tokens, the Digital Asset Exchange Alliance (DAXA) and 20 local exchanges have introduced the “Best Practices for Supporting Digital Asset Transactions” guideline. This guideline provides a framework for exchanges to review and potentially delist digital assets, with a more lenient review plan for assets that have been traded for over two years in eligible overseas markets with sufficient regulation.
Previous reports had indicated that South Korean exchanges might review the listing of over 1,000 altcoins within the next six months to ensure compliance with regulations. This had caused concerns within the crypto community about potential mass delistings. These regulatory developments reflect South Korea’s proactive stance on crypto regulation, aiming to establish high standards for both exchange operations and consumer protection. By doing so, the country hopes to lead the way in addressing the challenges faced by the crypto industry.
Overall, the new regulatory measures introduced by South Korea are expected to enhance market stability, protect investors, and deter financial crimes in the crypto sector. The country’s efforts to tighten oversight of crypto trading platforms mark a significant step towards creating a safer and more regulated environment for cryptocurrency trading.