July 3, 2023

South Korea Passes Law on Protecting Users of Virtual Assets

South Korea

South Korea

The South Korean government takes progressive steps to protect the crypto industry from unfair cryptocurrency trading by introducing a new bill, according to Cointelegraph.

On June 30, the South Korean National Assembly approved a draft law on protecting virtual asset users. The draft law aims to regulate unfair trade practices and protect crypto investors. The bill also aims to establish a basis for imposing penalties and liability for damages in case of unfair trading of virtual assets.

The draft law includes 19 crypto-related bills, giving a framework for a unified bill that defines digital assets and impose penalties for illicit trading activities.

Under the new legislation, virtual asset operators in South Korea are obliged to deposit and trust customer deposits, sign up for insurance and mutual aid in preparation for accidents such as hacking and computer failure, and create and store records of virtual asset transactions. All of these measures aim to protect the users.

The legislation also defined unfair trade practices, such as using undisclosed important information, manipulation of market prices, and illegal transactions.

In case of violating the new law, virtual asset operators will face imprisonment of not less than one year or a fine ranging from three to five times the amount of profit or loss avoided.

Earlier in May, the National Assembly also passed a bill that obligates parliamentarians and high-level public officials to report their holdings of crypto. The bill also included amendments to the Public Service Ethics Act and National Assembly Act, which puts cryptocurrency on the list of registered property by lawmakers. While the Public Service Ethics Act asks the members of the National Assembly and high-level public officials to disclose their crypto holdings.

Author profile

Whether you want to learn about NFT, Blockchain, Web3.0, Metaverse, or any other emerging technologies, we have the vital resources that will enlighten and help you make an informed decision.