South Korea’s National Assembly and several members of the Congress met on December 10. The first ever official crypto debate took place. High-ranking government officials, executives of digital asset trading platforms, and many other major stakeholders attended this meeting. South Korea is among the few countries taking the lead in embracing cryptos.
The debate, organized by the local market’s largest cryptocurrency exchanges, revolved around transparency in the crypto markets. The meeting also featured talks about the best way regulators can establish practical regulatory frameworks. Here is what transpired at that meet up.
Lee Seok-wu, the CEO of Dunamu, reiterated that regulations are necessary to establish stable industry standards. During the meeting, Lee Said:
“The role cryptocurrency exchanges play in the crypto and blockchain ecosystem is vital and the industry with the government has to establish regulatory guidelines to make sure that the local market is managed and operated by exchanges that meet high standards.”
The Upbit CEO emphasized that regulatory infrastructures implemented by the government need improvements. He focused primarily on the regulations set in the area of Anti-Money Laundering (AML) and Know Your Customer (KYC).
What Needs Improvement?
According to Lee, policies in the following crypto market areas need enhancement:
- Poor KYC/AML policies bar crypto exchanges from monitoring transactions
- Low standards of security set by small exchanges resulting in hacking attacks
- Regulatory policies enhancement is necessary to make sure that all platforms operate on the same levels.
Lee explained the insecure and risky nature of the crypto market to regulators, government officials, and lawmakers. He believes that the many hacking attacks arise from security breaches small crypto exchanges experience on a regular basis. Industry standards are necessary to regulate operations of minor digital asset exchanges aiming to only make a large profit margin.
On the other hand, the financial innovation bureau head at the Financial Services Commission (FSC), Kwon Dae-young, said that:
“Currently, the government’s position has not changed much since it was revealed last December or January this year. We are trying to institutionalize cryptocurrency exchanges.”
According to Kwon, before institutionalization takes place, solutions must be obtained to shield investors from future losses. He believes that authenticity and trust are important. Furthermore, he mentioned that projects that can help people improve their daily lives will be more prioritized than others.
Has South Korea Taken the Right Step?
South Korea is among the few countries implementing new policies to encourage the growth of its local crypto and blockchain ecosystem. The December 10 meeting shows that regulators’ commitment to listening to the new technology’s investors and operators has increased. The move by the government to cooperate with the industry leaders to create viable regulation policies is a positive sign.
These new developments show that South Korea is getting ready to compete with other major crypto markets in the world. Therefore, it will potentially attract new investors, talents, and start-ups into its local sector. Eventually, the economy will gain from the several blockchain developments that will emerge in a regulated manner.