South Korea Will Change Crypto Policy Following G20 Decision to Acknowledge Cryptocurrencies as ‘Financial Assets’
Having rather strict cryptocurrency policies, the government of South Korea took a decision to soften them and create more crypto-friendly regulation.
By Julia SakovichUpdated
3 mins readPhoto: Hannah Choi / Flickr
As it has been announced, the government of South Korea is going to make its cryptocurrency policy softer. This decision has been taken after G20 financial policymakers came to a conclusion that cryptocurrencies can be viewed as “financial assets”.
Last year, ICOs and all related activities were banned in South Korea, moreover, local investors were enforced to verify their identity if they wanted to continue crypto trading on virtual accounts opened at local banks. Nevertheless, the crypto community in the country was absolutely dissatisfied with such moves. A petition calling for a review of the government’s crypto regulations was signed by hundreds of thousands people.
The economic leaders from the world’s twenty largest economies have named July as a deadline to develop recommendations for regulating cryptocurrencies that should be considered to be “financial assets”. This move is to become only the first step toward “unified regulations” of cryptocurrencies.
However, given the speculative nature of cryptocurrencies, South Korea’s regulators used to classify them as “non-financial assets”. Nevertheless, there are more and more signs that Korea will change its attitude and soften its policies.
Korea also agreed to apply the standards of the Financial Action Task Force (FATF) while dealing with cryptocurrencies. Being an inter-governmental body that was created with a view to stop money laundering and terrorist financing, FATF works on development of the global standards that should be implemented all across the industry.
Korea’s financial watchdog the Financial Supervisory Service (FSS) admitted that the country should change its policies. Moreover, FSS plans to develop relevant issues in collaboration with another national financial institution – the Financial Services Commission (FSC)
“It’s almost certain that cryptocurrencies will be classified as assets and the main issue will be centered on how to regulate them properly under the unified frame that will be agreed upon between G-20 nations. Given the current stance [in Korea], this isn’t good, but we will step up efforts to improve things,” – explained the representatives of the Financial Supervisory Service.
Just in early May it was revealed that Korean lawmakers had proposed a new bill for the crypto sphere. As it was previously reported by CoinSpeaker, this bill is aimed at legalization of new digital currencies and ICOs in the country.
There are also some talks about cryptocurrency taxation in Korea, though currently crypto transactions are tax-free, the situation may be changed in case a relevant law will be issued.
As blockchain technology becomes more widely accepted in Asian countries, including Korea, the environment for building of decentralized applications (dApp) is actively developing. One of the evidence of this tendency is launch of new platforms and project.
A good example is Aurora Chain that represents itself an advanced smart contract platform. Blockchain features and consensus mechanisms implemented into this platform will ensure more efficient and secure environment for decentralized application developers.
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