The Financial Service Commission (FSC) of South Korea has directed 29 registered cryptocurrency exchanges, including Upbit, Bithumb, Coinone, Korbit, and Gopax, to regularly assess the tokens available for trading on their platforms and decide whether to continue supporting them.
South Korea is preparing to enforce a law aimed at protecting users of virtual assets, with implementation expected by July 19. The new legislation carries severe penalties for violations, including imprisonment of over one year or fines ranging from three to five times the amount of illegal profits. All 29 registered exchanges are required to review the more than 600 crypto tokens listed on their platforms.
Under the new law, exchanges must adhere to stricter guidelines for reviewing token listings and reevaluate existing tokens every six months to ensure compliance. Additionally, exchanges must conduct maintenance reviews every three months to maintain regulatory standards.
In early February, the South Korean government updated the Virtual Asset Users Protection Act, signaling tighter regulations for listing new tokens on exchanges. The FSC hinted at enhanced market monitoring and security measures, including a ban on tokens from projects with compromised security. This move aims to prevent tokens from projects with unresolved security issues from being listed on local exchanges.
The FSC is also developing new regulatory guidelines for crypto transactions on exchanges, expected to be implemented alongside the user protection law in July. Organizational changes are underway to streamline policies for the cryptocurrency sector, including the creation of a dedicated bureau within the FSC to oversee virtual assets and manage the industry’s regulatory framework. A proposal for this new bureau is set to be introduced on June 17 and reviewed by June 18.
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