Bank of Korea (BoK) has been authorized to intensify its scrutiny of cryptocurrency service providers and issuers as discussions on virtual asset legislation in South Korea continue. This move comes after a prolonged dispute between the BoK and the Financial Services Commission, over jurisdiction in the crypto space.
According to The Korea Herald, the BoK will now have the right to investigate operators of cryptocurrency-related businesses and request transaction data from crypto exchanges. The Bank of Korea (BoK) has been granted the authority to intensify its scrutiny of cryptocurrency service providers and issuers. This comes as discussions on virtual asset legislation in South Korea continue. Experts expect this development to accelerate the rollout of virtual asset laws in South Korea.
South Korean government has been actively pushing for crypto legislation. However, disagreements between the BoK and the FSC have been a roadblock. The FSC fears that the central bank governing crypto signals digital assets equal traditional finance, which they resist. The FSC chair even stated that he does not consider crypto a financial asset.
A Continuous Conflict
The BoK and FSC conflicted over crypto regulations for 3 years. Recent development grants authority to investigate crypto operators.
The BoK’s increased scrutiny is expected to result in stricter regulation in the South Korean crypto market. It may lead to increased compliance requirements for cryptocurrency service providers and issuers, with the central bank closely monitoring their operations. Furthermore, this move could enhance investor protection, as it allows for better oversight of cryptocurrency-related businesses and transactions.