Regulation
South Korea unveils regulations to initiate major delisting of cryptocurrencies
Financial regulators in South Korea are looking to incorporate protocols to stop trading in currently listed cryptocurrencies. The upcoming “Best Practices for Compliance with the Virtual Assets User Protection Act” will mark the delisting of several cryptocurrencies. Regulators said this crypto regulation will be released in early June.
Components of South Korea’s Upcoming Crypto Regulation
An insider from South Korea’s financial watchdog revealed on May 10 that the upcoming guidelines will include criteria for listing virtual assets. Furthermore, the regulation will incorporate guidelines on the decision-making process regarding the continued trading of already listed virtual assets. Furthermore, they emphasized that the aim is to establish a framework for the delisting of certain issuers of virtual assets in the event of problems.
Between late May and early June, guidelines will be provided. Currently, South Korea’s Financial Supervisory Department is developing guidelines to facilitate business self-regulation. crypto exchanges before the promulgation of the law on the protection of users of virtual assets in July. Key components will include standards for virtual asset issuance volume, distribution volume and transaction support.
Additionally, it will consider measures such as banning the listing of virtual assets with a history of hacking. Additionally, the regulation will establish the requirement for Korean white papers and technical manuals for foreign virtual assets.
Currently, the law on the protection of users of virtual assets is in its early stages. Therefore, an official from the Financial Supervision Service highlighted the limitations inherent in the regulation of issuers and distributors of virtual assets. “The law on the protection of users of virtual assets is still in its first stage, so there will necessarily be limits in the regulation of issuers and distributors of virtual assets,” he said, according to Korean economic daily.
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DAXA Position on Crypto Regulatory Review
Furthermore, to fill this deficit South Korea, efforts are underway to establish self-regulatory measures such as best practices and guidelines. The Financial Supervisory Service’s decision to introduce such best practices stems from criticism of the effectiveness of the Digital Asset Exchange Alliance’s (DAXA) Common Listing Guidelines, unveiled last year.
“DAXA has guidelines for designating precautionary actions and delisting, but it consistently adopts a laissez-faire attitude even if major exchanges do not follow them,” commented Min Byeong-deok, a member of the Democratic Party of Korea. In response, Min Byeong-deok condemned the neutralization of self-regulation. He said: “This has been neutralized and self-regulation no longer makes sense. »
Meanwhile, DAXA has explained that its member companies are not subject to its guidelines. He also emphasized autonomous review and decision-making regarding transaction support elements of member companies. “When a problem is identified with a member company’s transaction support item, it is reviewed in accordance with the procedures, but the review process and decisions are made by each member company,” said a member company official. DAXA.
In addition, the expected results of the upcoming announcement of best practices for listing virtual assets include the formulation of listing policies by national virtual asset exchanges. The reason behind this possibility is the authoritative nature of the guidelines, as opposed to the voluntary nature of advisory bodies like DAXA.
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