The FSC is preparing to enforce the new Virtual Asset User Protection Act, which could potentially lead to the delisting of approximately 600 altcoins from cryptocurrency exchanges in South Korea if they fail to meet established regulatory standards.
The new law is scheduled to take effect on July 19, alongside regulations detailing operational standards for crypto exchanges. This regulatory change affects cryptocurrency exchanges operating within South Korea, including major platforms like Upbit, Bithumb, Coinone, Korbit, and Gopax.
The Virtual Asset User Protection Act requires financial authorities to evaluate all altcoins listed on South Korean exchanges to determine their compliance with the new law. Exchanges must adhere to stricter listing rules, conduct bi-annual reviews of listed tokens, and perform maintenance checks every three months to ensure ongoing compliance. Non-compliance could result in penalties, including significant fines and potential jail time for those involved in illegal activities related to cryptocurrencies.
The introduction of the Virtual Asset User Protection Act represents a significant shift in the regulatory landscape for South Korea’s cryptocurrency market, which is known for its vibrant trading environment. The FSC’s move to implement these stringent measures aims to enhance investor protection, prevent fraud, and ensure the stability and integrity of the cryptocurrency market in South Korea. This approach reflects a growing global trend toward the tighter regulation of digital assets, as governments seek to curb the risks associated with crypto trading while fostering a safe and equitable market environment. The FSC is also considering additional regulatory measures and the formation of a dedicated team to oversee the compliance of virtual assets, underscoring its commitment to rigorous oversight of the crypto sector.
