Cryptocurrency users may have noticed the increased interest from South Korea as of late. A lot of Korean exchanges are generating high trading volumes. This applies to Bitcoin and popular altcoins alike. However, it appears future regulations may spoil the party quite a bit. It is unclear what type of regulation we can expect moving forward, though. However, South Korea will not let this Bitcoin adoption slide without some regulatory measures.
Various countries around the world are looking to regulate Bitcoin. Even though they can’t do so for the currency itself, service providers can face some backlash. It is expected such a situation will occur in South Korea shortly. More specifically, there is a discrepancy between how Bitcoin is classified. The South Korean National Tax Service sees BTC as money. The Fair Trade Commission does not and labels Bitcoin as a good. This needs to be clarified, to say the least.
South Korea Contemplates Bitcoin and ICO Regulation
Moreover, money transmitter businesses dealing with Bitcoin may need a specific license. That is not entirely uncommon, as exchanges need to adhere to strict guidelines all over the world. This will also help resolve any AML and CTF concerns regulators may have. With Bitcoin being unregulated, officials often feel it is a perfect tool for criminal activities. That is not the case, though, considering Bitcoin isn’t anonymous or privacy-centric. In fact, it is “too transparent” to be suited for criminal activity.
The bigger question is what will happen with remittance services in South Korea. Right now, Bitcoin can make a big impact due to the lack of regulation. It is believed a lot of Bitcoin remittance providers may be in violation of the Foreign Exchange Transaction Act, though. If that is the case, things are not looking all that great for a lot of companies. Until the new regulation is put in place, there isn’t much to worry about, though. It will be interesting to see how this situation plays out moving forward.
Last but not least, there is the pressing matter of cryptocurrency ICOs. Such fundraising campaigns remain largely unregulated all over the world. However, these schemes often result in selling securities, rather than tokens. It is evident the South Korean government will take a close look at this new popular trend, though. Cryptocurrency ICOs will be regulated sooner or later. Whether South Korea will be the first region to do so, remains to be seen.
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