Eun Seong-soo, chairman of South Korea’s finance committee, said this morning that more than 200 cryptocurrency exchanges are at risk of being shut down this September if they do not comply with current rules, according to a report by leading local trading firm Chosun.
He added that officials plan to tax cryptocurrency trading and that the government has no plans to protect investors who invest in cryptocurrencies.
#PANews April 22, p. Korean #FSC chief #EunSungSoo said all #crypto exchanges in Korea may be closed in September.
️Eun explained: About 200 cryptocurrency exchanges in South Korea must register to operate, but none have completed the process in Congress yet pic.twitter.com/iJcmdOpw92
– PANews (@PANewsOfficial) 22. April 2021
Rules for Korea
Earlier this year, South Korea introduced new laws for crypto companies and traders in the country, including stricter regulations, a new KYC policy, a different tax system, and a requirement for all crypto companies to register in the country.
The revised Special Currencies Act entered into force on 25 January 2009. After a six-month delay, it will enter into force on 24 March. September. According to the amendment, cryptocurrency companies must meet requirements such as Information Security Management System (ISMS) certification and the issuance of real name accounts.
But according to Eun, no exchange of cryptographic information had been registered with the government under the special currency law to which he responded: There are dogs, but they can all be taken out. They may suddenly close in September.
The harsh comments did not stop there. Eun said that while stock markets and traditional markets protect investors, the cryptocurrency market offers no protection and is not even comparable to buying and selling pictures.
I don’t think you should protect (investors) because people are investing and interested in more money. If you go the wrong way, it’s the wrong way, he explained.
Follow it, Korean government: We will tax cryptocurrencies, but we don’t consider them financial assets and we don’t think about protecting them https://t.co/1YrWycTHCM https://t.co/EU4QkSG7CJ.
– Doo (@DooWanNam) April 22, 2021
crypto-currency market boom
Eun’s comments come amid a booming cryptocurrency market in Korea and rising trading volumes. As reported last month, the volume of cryptocurrency trading on some days has surpassed that of the country’s stock market, the first such case in the world.
According to analysis tool CoinGecko, Korea’s three largest cryptocurrency exchanges traded nearly $20 billion in the past day alone, while other major exchanges traded more than $100 million.
Although Eun’s statements sound the death knell for local stock markets in South Korea, industry experts believe they are more of a warning than a final judgment.
This is an understandable explanation, given the accumulation of different problems. But I see it more as a warning, says Doo Wan Nam, business development manager at MakerDAO Asia in Seoul. Korean traders are probably hoping for the same.
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