The cryptocurrency bill has passed its first phase, raising the industry's hopes. This will strengthen the regulation of the financial services commission by being the regulatory authority for all crypto companies.
This bill, when it becomes law, will include many points, such as that activities that involve stopping withdrawals will have to be reported to the Financial Services Commission. The bill defines digital assets as the electronic representation of economic value that can be traded or transferred electronically. It does not include central bank digital currency (CBDC), other products and services of the Central Bank of South Korea, which is the Bank of Korea.
The points included in Crypto Bill
The cryptocurrency bill mandates disclosure of investor information, otherwise strict fines and punishments will be imposed. False promotion of crypto assets and price manipulation are also subject to sanctionable actions. The person must serve a five-year prison sentence if he commits a crime and fraud worth 5 billion Korean won.
Proper implementation of the cryptocurrency bill would allow businesses and industry stakeholders to operate safely. There are a few more steps left for the cryptocurrency bill to be approved in the Legislation and Judiciary Committee. The first phase has already passed in the National Assembly.
Hwang Suk-Jin, a member of the Digital Assets Special Committee of the ruling People Power Party, expressed optimism that the cryptocurrency bill will become law within a year. Both South Korea's ruling party and opposition party agree on the bill. This is one of the reasons why the bill is moving forward to become law.
Suk-Jin has been sincerely involved in the development of the cryptocurrency bill. He also expressed hope that the cryptocurrency bill can actively prevent unfair trade acts. As of 2020, South Korea has one of the most active cryptocurrency economies in the world. Based on global cryptocurrency adoption, it ranks seventh according to blockchain data platform Chain analysis.
The data further reveals that the country has fallen to 23rd place in the index due to the collapse of the Terra Luna cryptocurrency. The crash prompted legislation in South Korea to develop a legal framework to cover cryptocurrencies. This will add security and protection for the investor.
The next stage of cryptocurrency legislation will focus on the release of crypto tokens by companies. Its issuance and dissemination of information will be included.
Summary
The cryptocurrency bill in South Korea passed the first phase. This will empower the cryptocurrency industry as it will clarify the mandatory rules related to cryptocurrencies. Investor information, false promotion and price manipulation are some of the important points included in the bill.
