Following multiple hack reports, the South Korean government explains how it will strengthen the regulatory framework for cryptocurrency exchanges. A bill has already been submitted which imposes multiple new obligations on crypto exchanges.
Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space
Korean Government’s Solution
Following recent reports of multiple security breaches at cryptocurrency exchanges, the South Korean government has revealed the details of the new bill to regulate crypto exchanges, local media report.
Choi Jong-ku.
On Tuesday, June 19, South Korea’s second largest crypto exchange, Bithumb, posted a notice on its website and tweeted that about 35 billion won (~US$31 million) worth of cryptocurrencies was stolen. However, the exchange promptly removed the notice and deleted its tweets about the theft shortly afterward. The Bithumb incident came just 10 days after the country’s seventh largest crypto exchange, Coinrail, claimed that it was hacked on June 10, with the damage estimated at approximately $40 million.
Choi Jong-ku, Chairman of the country’s top financial regulator, the Financial Services Commissions (FSC), commented on the Bithumb news on Wednesday. He was quoted by Newsis saying:
In order to prevent this, we need to make the [crypto] transaction system stable and strengthen the protections of the traders by virtual currency handling businesses.
He explained that an amendment bill to the Act on Reporting and Using Specified Financial Transaction Information has already been submitted to the National Assembly in order to achieve this.
Crypto exchanges are currently “in the blind spot” of the Korean regulators, Newspim wrote, adding that they are “expected to be monitored by the financial authorities through the ‘report system’.” The publication elaborated, “This will block illegal money laundering using virtual currency exchanges and enhance
