South Korea's FSC Proposes Regulatory Approval Requirement for New Crypto Executives
Summary:
South Korea's Financial Services Commission (FSC) proposes amendments that could enforce new cryptocurrency executives to acquire regulatory approval before commencement of their role. The proposal aims to allow the FSC to vet executives joining crypto firms and withhold the review of Virtual Asset Service Provider license registrations during ongoing investigations. This revision, if effective, will impact the VASP renewal process and the laws are expected to be operational by the end of March 2024. The South Korean regulator has called for public feedback on the proposal until March 4.
Amendments proposed by South Korea's Financial Services Commission (FSC) may soon mandate new executives in cryptocurrency projects to obtain regulatory consent prior to assuming their roles. On February 5, a significant change was suggested in the reporting requirements for Virtual Asset Service Providers (VASP), equipping the FSC with the ability to vet new executives joining cryptocurrency companies. If instigated, this regulation would enforce the obligation of cryptocurrency businesses to inform the financial authority about employee changes. Consequently, executives cannot commence their duties without FSC's authorization of the reported personnel change. Local news source, Money Today anticipates this amendment to be operational by the end of March 2024, following a series of processes including a Ministry of Government Legislation review and an FSC resolution. Post revision of this ordinance, new regulations apply to VASP renewal reports slated for the latter half of 2024. These proposed regulations are also expected to impact the renewal process for VASP licensure. If the FSC perceives an ongoing local or international investigation of personnel, it can withhold the review of VASP license registration applications under these amendments. South Korea’s regulatory body has put forth this proposed alteration for public feedback, open for comment till March 4. South Korean regulators, recently, have been considering stricter guidelines for the nation’s cryptocurrency environment. A local source–Decenter, reported on January 15 that South Korea's Financial Intelligence Unit (FIU) is deliberating on legislation pertaining to cryptocurrency mixers, apparently to curb money laundering. The regulatory body plans to implement laws parallel to those of the United States, as crypto mixers misuse is observed to increase. Earlier this month, the FSC had alerted about probable illicit transactions and money laundering via South Koreans procuring cryptocurrency through foreign exchanges. The FSC, on January 3, came up with a legislative notice suggesting a revision in their credit finance laws to disallow locals to purchase cryptocurrency with credit cards.
Published At
2/5/2024 12:10:24 PM
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