(Rejected Duplicate) South Korean Parliament Passes Law Legalizing Cryptocurrency Trading and Holding
Following the Supreme Court of India to lift the ban against cryptocurrency, South Korea has today passed a new amendment that approved cryptocurrency trading. The South Korean parliament, the National Assembly, has unanimously passed what could be the official entry of crypto holding and trading into the country’s legal system.
Cryptocurrency Is Now Legal in the Country
Cryptocurrency trading is now legal in South Korea, meaning that citizens are allowed to legally hold and trade digital currencies. The new legislation provides a framework for the legalization and regulation of crypto exchanges and cryptocurrencies.
The South Korean parliament amended and passed the Special Financial Transactions Information Act that previously was approved in November 2019.
The regulator will now work towards developing a new framework regarding how the federal government should oversee what is identified as “virtual asset service providers.” Cryptocurrency exchanges fall within this definition.
South Korean president Jae-In Moon will have to sign the amendment into law to begin the enactment process. Based on the country’s legislative framework, it will take one year from the date of the signing, meaning that the bill to begin its implementation in March 2021.
The new legislation will see crypto-related businesses like trusts, exchanges, token-sales, and wallet companies complying with know your customer (KYC) procedures and anti-money laundering (AML) rules by the end of the first quarter of 2021.
The cryptocurrency-related businesses also would need to obtain a real-name identification verification partnership with an approved bank within South Korea as well as the ISMS (information security management system) certification. The KISA (Korea internet security agency) provides the certification when it assesses each firm to ensure it protects important information assets for itself and the users. All relevant firms must comply within six months after the enactment of the bill. Otherwise, they risk being closed down.
But South Korea Got Tougher on Cryptocurrencies
South Korea has been at the forefront of the crypto boom and bust since 2017. The country was one of the few nations with wide-scale adoption of the technology. But its stance on cryptocurrency gradually changed. In December 2017, the South Korean government banned anonymous trading on local exchanges and continuously monitor crypto activities. Such harsh events came after the South Korean prime minister mentioned that cryptocurrency could lead children to illicit activities like drug trading. The South Korean government hence put tough regulations on the nation’s burgeoning crypto markets, and eventually slammed cryptocurrency prices.
However, today’s vote in the legislature is a relatively quick turnaround for the regulatory body. The passage of the bill indicates the increasing acceptance of cryptocurrencies and blockchain in the context of financial services both locally and across the globe. Cryptocurrency investors in South Korea have welcomed the new crypto bill, which is also seen as a boost for the Korean startup ecosystem.