South Korea’s government has established a new task force to regulate bitcoin and other cryptocurrency trading. Taking over the effort from financial regulators, the Ministry of Justice has now been put in charge of the task force to establish and implement cryptocurrency regulations.
Also read: Japan Increases Lead – Approves Another Four New Cryptocurrency Exchanges
Cryptocurrency Countermeasure Task Force
On Monday the South Korean government established a “virtual currency countermeasure task force” to “promptly review measures to strictly regulate virtual currency transactions,” reported The Asia Times.
This is the second task force set up by the government. The first was smaller and only involved financial regulators. It also made little progress to create a regulatory framework for cryptocurrencies and has been inactive since September, Maekyung Media described.
In an effort to speed up regulation, “the ministries agreed to jointly set up a government-wide measure to strictly regulate virtual currency transactions under the supervision of the Ministry of Justice,” the publication added. The new task force’s first meeting was also held on Monday to reevaluate domestic and foreign cryptocurrency market trends and their future countermeasures.
“Related agencies have expressed serious concern about the recent rise in virtual currency speculative trading and the continued increase in virtual currency-based offenses,” the news outlet wrote and quoted the government announcing:
We agreed that the Ministry of Justice will be the main ministry and will set up and implement the regulatory measures through consultation between the related ministries.
Legal Status of Cryptocurrency in Korea
While there is currently no law to protect cryptocurrency investors in South Korea, the government is actively discussing the legal framework for cryptocurrencies. The ministries were quoted at the meeting by The Korea Times:
Virtual currency cannot be viewed as a financial product or money. While virtual currency trading is claimed to be safe and thus the future money, blockchain technology only guarantees secure transactions and does not guarantee value.
In order to protect investors, the government is pursuing regulations to ensure that cryptocurrency exchanges meet certain requirements. For example, they must deposit client investments in banks or other reputable institutions and must inform customers of investment risks in detail. In addition, the punishment level for multi-level crimes involving digital currency transactions will be greatly increased, the publication detailed.
“We will make regulations for the protection of investors rather than making virtual currency exchange regulations,” the finance minister said at the meeting.
Do you think South Korea will introduce cryptocurrency regulations soon? Let us know in the comments section below.
Images courtesy of Shutterstock and the South Korean Ministry of Justice.
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