South Korea to balance investor protection and innovation in cryptocurrency regulation

Kim So-young, the vice chairman of the Financial Services Commission of South Korea, made an announcement that regulators will prioritize innovation in the next phase of cryptocurrency regulation, highlighting the importance of striking the right balance between protecting investors and promoting innovation in the digital currency space. The statement was made in a conference organized by the South Korean government and central bank in collaboration with the International Monetary Fund (IMF).

It is worth noting that South Korea has recently enacted legislation to regulate virtual assets and protect investor interests in the cryptocurrency markets by adding the cryptocurrency regulation. These new regulations are scheduled to take effect in July 2024. Additionally, in October, the Bank of Korea launched an initiative to develop a wholesale central bank digital currency (CBDC).

This statement comes against the country’s cryptocurrency-related challenges, including an alleged fraud involving South Korean crypto entrepreneur Do Kwon, which have raised concerns among the public and regulators regarding the stability and integrity of crypto markets.