As scams, exploits, and rug-pull activities increase in the cryptocurrency industry, South Korea’s Financial Services Commission (FSC) has announced that all 29 registered crypto exchanges must regularly evaluate the tokens listed on their platforms. These registered crypto exchanges include Upbit, Bithumb, Coinone, Korbit, Gopax, and others.
South Korea FSC’s new law on listed cryptocurrencies
This announcement from South Korea’s FSC comes as the country prepares to implement a strict law on virtual asset user protection by July 19, 2024. Additionally, the upcoming legislation imposes severe penalties for violations, including jail sentences of at least one year and fines ranging from three to five times the amount of any illegal profits.
These strict actions highlight the government’s dedication to providing a secure and transparent crypto trading environment across the country. Similar strict actions have been observed on the world’s biggest cryptocurrency exchange, Binance, which regularly reviews every listed asset to maintain a high standard according to industry requirements as reported by Todayq News.
Besides this, SFC advised all registered crypto exchanges must investigate the over 600 cryptocurrencies currently listed on their platforms. Initial reviews are to be completed within six months of the law’s implementation, followed by quarterly maintenance reviews. This strict process aims to ensure that all tokens meet the new, stricter guidelines established by the FSC.
Strict guidelines for token listing
The FSC had previously hinted at these tighter regulations in April 2024, highlighting the need for improved market monitoring and security measures as reported by Todayq News. The new standards will likely prevent the listing of tokens from projects with security breaches or unresolved issues. This is part of a broader effort to enhance investor protection and market integrity.
In addition to these guidelines, the FSC is developing new regulatory frameworks for crypto transactions, which are expected to be implemented alongside the user protection law. These regulations will further strengthen the oversight of crypto exchanges and transactions in South Korea.
To manage the evolving crypto industry more effectively, the FSC plans to establish a new bureau dedicated to virtual assets. This specialized bureau will be responsible for overseeing the entire regulatory framework for the cryptocurrency sector. The proposal for this new bureau is set to be introduced on June 17 and reviewed by June 18.
