South Korea’s Financial Supervisory Service, the country’s regulator, has recommended setting up a unified system for mandatory information disclosure from digital asset exchanges and issuers of cryptocurrencies to provide more dependable data and protect investors from fraud, according to local media reports.
See related article: S.Korea sees passing crypto investor protection as a priority: report
Fast facts
- Ahn Byung-nam, the head of Digital Asset Research at the regulator, said a unified mandatory disclosure system about issuance, listing and circulation of cryptocurrencies will provide better safeguards to investors, Asia Business Daily and other media reported, citing his comments at a Monday meeting of the government’s Digital Assets Committee.
- Other officials at the meeting emphasized the need for stricter disclosure on token issuers and exchanges, according to the media reports, following a series of bankruptcies and allegations of fraud in the global crypto industry last year.
- Disclosure of relevant financial information should be an obligation to protect investors, but there aren’t any requirements right now for such digital assets, Jeon In-tae, professor of mathematics at the Catholic University of Korea, said at the meeting, according to Asia Business Daily.
- Last year, South Korean blockchain game developer Wemade’s native token WEMIX was delisted from four major exchanges in the country on reports it underreported circulation numbers for the token. WEMIX plunged over 70% in less than a week on the report.
- At the same meeting, Cha Myung-hun, the chief executive officer of local crypto exchange Coinone, said the Digital Asset eXchange Alliance (DAXA) is developing a unified standard for exchanges in token delisting, according to the news reports. DAXA is a trade group of five local exchanges — Upbit, Bithumb, Coinone, Korbit and GOPAX — that are licensed to provide fiat-to-currency services to local investors.
- South Korea has been working to establish an all-encompassing regulatory framework for protecting digital asset investors, initially aimed at being enacted last year. Around ten proposals were presented at the country’s National Assembly, but none have been discussed at its parliamentary sessions.
See related article: South Korea unlikely to push out crypto regulation before the U.S., authority says