[2018-05-18] South Korea to Follow G20 Unified Cryptocurrency Regulations

[ivanpoldark]

The South Korean government reportedly plans to soften its crypto regulations in line with the policies set by the G20 nations in an effort to create “unified regulations.” The Korean regulators have also agreed to apply the standards set by the Financial Action Task Force to its crypto policies.

G20’s Unified Crypto Regulations

South Korea is reportedly planning to follow the policies set by the G-20 nations and soften its crypto regulations, the Korea Times reported.

The G20 is an international forum for the governments and central bank governors. Its members are Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, South Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, United Kingdom, United States, and the European Union.

The top financial policymakers of these countries have agreed to acknowledge and regulate cryptocurrencies as financial assets, the news outlet noted, elaborating:

Financial policymakers of G-20 nations have set a July deadline for the first step toward ‘unified regulations’ of cryptocurrencies. One reason for the move by the G-20 is that they see cryptocurrencies as ‘too small to jeopardize’ financial markets. The combined market value of cryptocurrencies is less than 1 percent of the global GDP.

Financial Action Task Force Standards

While the G-20 classifies cryptocurrencies as financial assets, the Korean government has earlier classified them as non-financial products due to their speculative nature. Acknowledging the differences, the country’s Financial Supervisory Service (FSS) was quoted expressing:

It’s almost certain that cryptocurrencies will be classified as assets and the main issue will be centered on how to regulate them properly under the unified frame that will be agreed upon between G-20 nations. Given the current stance, this isn’t good, but we will step up efforts to improve things.

South Korea has also agreed to apply to cryptocurrencies the standards of the Financial Action Task Force (FATF), an inter-governmental body formed to fight money laundering and terrorism financing, the publication conveyed.

Softening Crypto Policies

Recently, the new FSS chief indicated that he will ease the country’s cryptocurrency regulations. Governor Yoon Suk-heun said there are many positive aspects of cryptocurrencies, promising to release updates on this issue in the near future.

Meanwhile, the country’s National Tax Agency has been collaborating with the finance ministry to collect tax data in order to establish crypto tax policies. While cryptocurrency transactions are currently tax-free in Korea, crypto operators are required to pay income taxes, the news outlet detailed.

Despite the new FSS chief suggesting an easing of crypto regulations, his department has launched an investigation into crypto exchanges, in collaboration with other related authorities. In March, the prosecution arrested four employees of crypto exchanges including the CEO of Coinnest. Last week, they started investigating the country’s largest crypto exchange, Upbit. This week, three people were arrested from HTS Coin exchange for alleged fraud and embezzlement charges.

https://news.bitcoin.com/south-korea-g20s-unified-cryptocurrency-regulations/

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[Kemarit]

I'm at a lost here. First, they are very friendly to crypto and then they change their tune but it became so popular in South Korea that the people petition the government to shift their hard line stance. They did which is very good, however they continue the witch hunt and the Upbit investigation is rolling. Now, they are telling us that they will follow the G20 unified regulation which is what? 2 months for now and they still don't know what's the exact framework of that regulation. We still don't know if it would be lenient or a tougher one.

[Betwrong]

I'm at a lost here. First, they are very friendly to crypto and then they change their tune but it became so popular in South Korea that the people petition the government to shift their hard line stance. They did which is very good, however they continue the witch hunt and the Upbit investigation is rolling. Now, they are telling us that they will follow the G20 unified regulation which is what? 2 months for now and they still don't know what's the exact framework of that regulation. We still don't know if it would be lenient or a tougher one.

I think it is more likely that the regulations will be more lenient than before. With tough regulations they can only kill the business, but since they want to tax it they are uninterested in killing it. Actually, I've been always keeping my hopes up regarding South Korea's approach to cryptocurrencies. Imo the government of this country, although it may make mistakes, is a progressive thinking one overall.