The Financial Supervisory Service (FSS) has recently set up dedicated organizations to supervise and investigate cryptoassets. This move is seen as a sign that the Korean financial authority is willing to regulate and manage the crypto asset market like other financial institutions.
On Nov. 29, the FSS announced the establishment of two new bureaus - the Virtual Asset Supervision Bureau and the Virtual Asset Investigation Bureau. These bureaus were created in response to the rapid growth of the virtual asset market and aim to proactively address any potential issues that may arise.
The Virtual Asset Supervision Bureau is responsible for overseeing virtual assets and ensuring that virtual asset operators are complying with regulations. This includes monitoring the market and improving the system, as well as promoting the establishment of a regulatory system related to virtual assets to stabilize the market.
On the other hand, the Virtual Asset Investigation Bureau is focused on investigating and cracking down on any market disruptive behavior, particularly unfair trade practices. The goal is to prevent any disruption to the market order and protect users from any damage caused by unfair transactions.
The FSS has previously focused on assisting with virtual asset legislation, research, and market monitoring through its Digital Asset Research Team. The Financial Services Commission has also conducted investigations through its Financial Intelligence Unit (FIU), focusing on anti-money laundering.
Recently, however, the tide has turned. In June, the Act on the Protection of Virtual Asset Users was passed by the National Assembly and is expected to take effect in July next year. The Ministry of Justice is also evaluating whether crypto assets held by exchanges can be classified as trusts.
The largest cryptocurrency exchange in the United States, Coinbase, has received a large investment from the National Pension Service. This is the first time the National Pension Service has directly invested in an exchange, as it has previously avoided investing in cryptocurrencies due to their high volatility. Although the National Pension Service has not invested in virtual assets such as Bitcoin, this investment has sparked discussions that virtual assets may soon become a part of the institutional system.
“There is a growing belief that the U.S. Securities and Exchange Commission (SEC) will approve a bitcoin spot exchange-traded fund (ETF) at the beginning of next year,” said an industry insider. " This would mean that virtual assets will become a part of institutional finance, leading to a significant upswing in the blockchain industry.”
This article was originally published on Dec. 7, 2023.
