Content: South Korea's Financial Supervisory Service (FSS) is preparing to implement stringent regulations for virtual assets, effective from July 2024. These regulations aim to enhance investor protection in the crypto market. Key provisions include requiring exchanges to pay interest on user deposits and maintain a minimum reserve. Moreover, the FSS mandates that exchanges segregate user deposits from proprietary assets, ensuring secure storage in banks.
Additionally, the legislation introduces insider trading rules, aligning with those in traditional stock markets to ensure transparency and accountability. Exchanges will be obligated to monitor transactions vigilantly and report any unfair trading practices to financial authorities. The legislation also enforces a minimum reserve requirement for virtual asset exchanges, amounting to at least 30 billion won, with a mandate for the majority of this reserve to be stored in cold wallets to enhance security.
Furthermore, the new regulations prohibit unexpected disruptions to user deposits and withdrawals, safeguarding investor interests. It's important to note that non-fungible tokens (NFTs) and deposit tokens linked to Central Bank Digital Currencies (CBDCs) fall outside the legal scope of these virtual asset regulations
Disclaimer: Please note that the information provided in this article is based on the referenced research articles. It is essential to conduct further research and analysis before making any investment decisions. The cryptocurrency market is highly volatile, and investors should exercise caution and consult with financial professionals before engaging in cryptocurrency trading or investment activities.
