Crypto Industry Officially Recognized in South Korea

The government is changing its position on the cryptocurrency industry in an attempt to get closer to international standards and ease its regulations.

South Korea’s government officially recognized for the first time the crypto industry, releasing a classification of its elements, while at the same time its financial watchdog is about to ease the regulation on the blockchain.

The move matches the intention of G20 countries to unify their regulations.

Local media portal The BChain reported that South Korea’s government had released a new classification system for the crypto and blockchain industry, defining ten categories, including blockchain system, decentralized application, and cryptocurrency exchange. Now the government officially recognizes crypto exchanges as “cryptocurrency exchanges and brokerages”.

The full details of the new classification will be published later this month.

Meanwhile, South Korea’s Financial Services Commission (FSC), the body that monitors policies and guides the Financial Supervisory Service (FSS), came up with several updates related to all activities of local crypto exchanges, the Korea Times reported.

“The FSC made revisions to its rules to apply strengthened policies in order to prevent or detect money laundering and illegal activities because the regulator isn't opposed to cryptocurrencies,” an unnamed representative of the regulator stated. 

Another official said that international cooperation was needed given that unified rules might be challenging.

The two officials have made it clear that the regulators would not interfere with the government’s current position on cryptocurrencies.

“Any major reversal in policies is unlikely, but the government seems to believe a gradual shift in attitude towards crypto-based assets is needed. What regulators should do is figure out how to regulate them properly and prudently as Korea needs to put more emphasis on blockchain technology after obtaining know-how and understanding of the possible flipside of cryptocurrency trading,” Korea’s trade ministry stated.

The National Assembly, South Korea’s parliament, has come up with a plan to lift the ban on initial coin offerings (ICO), according to Rep. Hong Eui-rak of the Democratic Party.