South Korean Financial Services Commission Approves Central Bank’s Request for Data Submission Right for Investigating Virtual Assets

On April 22nd, it was reported that the South Korean Financial Services Commission (FSC) has abandoned its opposition to the Central Bank’s acquisition of the “request for data submission right”, and the Central Bank of Korea will be granted the right to investigate virtual assets. According to local reports, the FSC’s decision was made a few weeks after a subcommittee of the Political Affairs Committee of the South Korean Parliament accused the regulatory agency of seeking to become the sole regulator of virtual assets. It is reported that as the FSC has decided to waive its requirements, there are reports that the South Korean National Assembly will continue to develop plans to incorporate the right of the Central Bank of Korea to request data into the Virtual Asset Law. Before finally agreeing to the central bank’s request, there were multiple conflicts between the FSC and the Central Bank of Korea regarding which of the two institutions should regulate payment settlement. On the other hand, the central bank insists on being granted the right to investigate digital assets, as the risks generated by the virtual asset market ultimately threaten financial stability. （News.Bitcoin）

Report: The Bank of Korea has obtained the right to investigate virtual asset entities after financial regulatory authorities have abandoned their opposition

Introduction

On April 22nd, the South Korean Financial Services Commission (FSC) announced that it will no longer oppose the Central Bank’s request for data submission right to investigate virtual assets. This decision allows the Central Bank of Korea to play a more active role in monitoring and regulating digital assets in the country.

The Background

The FSC’s decision was made after weeks of heated discussions between the political committees and regulatory agencies in South Korea regarding their roles in regulating virtual assets. A subcommittee of the Political Affairs Committee of the South Korean Parliament accused the FSC of trying to become the sole regulator of virtual assets, which negatively impacted the Central Bank’s plans to regulate payment settlement.
The central bank insisted on being granted the right to investigate digital assets, stating that the virtual asset market poses a significant risk to financial stability in the country. Despite the conflicts, the South Korean National Assembly plans to incorporate the right of the Central Bank to request data into the Virtual Asset Law.

The Implications

The FSC’s decision to waive its requirements is good news for investors and businesses involved in digital assets in South Korea, as the Central Bank will now have more power to regulate and monitor the industry. With this new authority, the Central Bank can request data from businesses, exchanges, and related parties in the virtual asset industry.
The move comes as no surprise due to the increasing popularity of virtual assets in South Korea. According to a report by the Financial Supervisory Service in March, the country’s digital currency market grew by 44.2% in transaction volume in the first quarter compared to the previous year, with the number of accounts also increasing by 26.4%.

Conclusion

South Korea’s decision to allow the Central Bank to investigate virtual assets is a significant step in the country’s developing regulatory landscape surrounding digital assets. The FSC’s decision came after a long period of conflict and tension, but it demonstrates South Korea’s willingness to regulate the industry while helping to reduce risks that could threaten financial stability.

FAQs

#Q1. What does the decision mean for businesses in the virtual asset industry in South Korea?

The Central Bank’s request for data submission right means that businesses, exchanges, and related parties in the virtual asset industry may be subjected to more scrutiny and monitoring. As such, business owners will need to comply with new regulations and requirements.

#Q2. What were the conflicts between the Central Bank and the FSC?

The conflicts surrounded which of the two institutions should regulate payment settlement. The Central Bank insisted on being granted the right to investigate digital assets as the risks generated by the virtual asset market ultimately threaten financial stability, while the FSC wanted to become the sole regulator of virtual assets.

#Q3. Will the Central Bank’s request negatively impact the virtual asset industry in South Korea?

The Central Bank’s request for data submission right will help regulate and monitor the virtual asset industry in South Korea, which will ultimately benefit the industry as a whole. Consequently, investors will feel more confident when investing in digital assets since the new regulations will help reduce the risks involved.