As an experienced financial analyst, I view this development with a cautious optimism. The South Korean government’s decision to implement stringent regulations under the Virtual Asset User Protection Act is a commendable step towards enhancing regulatory compliance within the crypto sphere. However, this move could also have significant implications for altcoins listed on domestic exchanges, particularly those with low trading volumes and problematic disclosures.
As a crypto investor, I’ve been keeping a close eye on the latest developments in the regulatory landscape of South Korea. Starting from next month, financial authorities there plan to delist approximately 600 altcoins under their new Virtual Asset User Protection Act. This means that these digital assets may no longer be available for trading on local exchanges. As an investor, it’s crucial for me to stay informed about such changes and adjust my portfolio accordingly.
In anticipation of the Virtual Asset User Protection Act, set to take effect on July 19, this action is being taken to strengthen regulatory compliance in the cryptocurrency sector.
According to recent news, the South Korean administration has concluded a rigorous blueprint, referred to as the “best practice plan,” designed to reinforce virtual asset transactions.
As a dedicated crypto investor, I believe in maintaining transparency and trust in the digital currency market. In this context, I propose a stringent evaluation process for cryptocurrencies to uphold their listing status on domestic exchanges. Different from the present system where exchanges independently decide which tokens to list, this revised strategy empowers authorities to establish universal standards for all listed digital assets.
The main emphasis of these regulations is on conducting regular screenings of lists of virtual assets. Every six months, exchanges will reevaluate their backing for each digital asset, with further assessments taking place every three months. Virtual assets that do not meet the required criteria may face the suspension of transaction support.
The new standards cover nine essential elements: eligibility for inclusion, issuer trustworthiness, safeguards for users, technological security, and compliance with regional regulations.
Examining the practices of information disclosure and its circulation during reliability checks is essential. On the other hand, user protection assessments necessitate focusing on monitoring blockchain activities and ensuring the accessibility of white papers.
It’s crucial that technical security is not overlooked when it comes to cryptocurrencies. A pristine history of hacks and clear, accessible smart contract code are essential for these digital assets. Cryptocurrencies with opaque transaction histories or those directly issued by exchanges may be subject to removal from listings.
When applying for a listing in South Korea, issuers are required to provide thorough disclosures, solid issuance proposals, and convincing business backgrounds. The Korean regulatory body retains the authority to scrutinize listings based on qualitative factors, except for assets that have an unblemished record on reputable foreign exchanges.
As a crypto investor, I recognize that regulatory shifts in South Korea have the potential to reshape the local digital asset landscape. These changes could particularly influence altcoins with meager trading activity and questionable disclosures, given that the country hosts approximately 29 homegrown crypto exchanges, such as Upbit.
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2024-06-17 08:04