How does South Korea’s Financial Services Commission look To Create Space for Crypto Currency?
South Korea’s financial regulator, the Financial Services Commission (FSC), is keen to find out as to how the digital currency and its platform, blockchain technology, could be accommodated. The agency is thinking of restructuring itself that will offer enough space to have the Financial Innovation Bureau. The objective of such a move is to respond to any financial innovation proactively in the fresh industrial revolution. The move is also probably aimed at removing uncertainty in the virtual asset sector amidst growing awareness.
The FSC disclosed in a recent statement that it intends to undergo a big organizational reshuffle. This is meant to not only protect financial consumers in a better way but also respond to the financial innovation in a proactive manner in the era of the fourth industrial revolution. It is keen to avoid getting the tag of discouraging innovation or stifling it. This is quite evident when the regulator indicated that the new bureau is entrusted with the responsibility of initiating any policy changes in the face of uncertainty in the cryptocurrency space.
The FSC disclosed that the innovation bureau would focus on the development and challenges in respect of the digital coin sector. At the same time, it will closely work with advanced financial services in the fintech with the help of big data. Significantly, the latest move comes on the heels of the global Financial Stability Board (FSB) issuing a statement that there is no material risk to the global economy due to either bitcoin or any other virtual assets, ambcrypto.com reported.
The FSB report also wanted a lenient approach towards the digital coin sector. Incidentally, South Korea is part of the agency. The country is well ahead of several others in the space and ranked the third most countries in encouraging the virtual currencies within the country. This is evident from the growth of Bithumb as one of the largest players in the crypto space.
In any case, the restructuring has elicited a favorable response from the supporters of the cryptocurrency community. For instance, Fantom Foundation, a blockchain technology firm, said, “Virtual coin and related blockchain technologies will come to our everyday life sooner or later. I think Korea can be an ideal incubator to test drive new virtual coins and their blockchain systems. Now it is the government’s role to establish a favorable environment for virtual coins and their blockchains.”
Significantly, the country’s Supreme Court has given a favorable ruling in Bitcoin case terming it as a legally recognizable asset. This was in contrast to a decision taken by lower courts against the same cryptocurrency last year. The changing perception is also making banks to apply their procedures on the digital coin exchanges even for their non-client accounts. The country has also issued fresh anti-money laundering rules to cope up with the use of crypto.
The banks will have to share key data like overseas digital trading platforms with the regulator as and when required. Also, the move is meant to curb any suspicious transactions in respect of the virtual assets.