South Korea Revamps Crypto Regulation Laws, OKs Virtual Asset User Protection Act

Zinger Key Points
  • Act defines digital assets and outlines penalties for unfair transactions.
  • Bank of Korea granted power to demand data from service providers.

South Korea's National Assembly has given the green light to the Virtual Asset User Protection Act, marking a significant stride towards establishing a legal structure for virtual assets.

The legislation is set to come into force next year.

The act, an amalgamation of 19 proposals put forth by legislators, provides a clear definition of digital assets and outlines penalties for any unfair transactions.

See Also: Hacker Steals Over $10M In Ethereum, Poly Network Tells Users 'Withdraw Liquidity'

Service providers must now keep user assets separate, hold insurance, maintain a certain level of reserves in cold wallets, and keep a comprehensive record of all transactions.

"The bill empowers the Financial Services Commission with the authority to supervise and inspect service providers," the legislation reads. It also grants the Bank of Korea the prerogative to demand data from these service providers.

The legislation comes at a time when virtual assets are under increased scrutiny in South Korea, following an inquiry into a local lawmaker's crypto holdings and the downfall of Terraform Labs LUNA/USD last year.

Read Next: Bitcoin Gains Unexpected Allies As Financial Giants Turn From Skeptics To Supporters

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Posted In: CryptocurrencyNewsTop StoriesMarketsBank of KoreaCrypto Cold Walletscrypto regulationDo KwonFinancial Services CommissionSouth Koreavirtual assets
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