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In a bold move to safeguard the integrity of its burgeoning cryptocurrency market, South Korea is set to overhaul the regulatory framework governing the listing of tokens on exchanges. This initiative includes stringent measures to block the listing of tokens that have fallen victim to hacking incidents.
New South Korea Regulations on the Horizon
According to a report by News 1, the Financial Supervisory Service (FSS) is at the forefront of developing these new guidelines. These measures have been in the pipeline since the latter half of the previous year, with valuable insights being incorporated from key industry players, including the Digital Asset Exchange Association (DAXA). The enactment of these guidelines comes in anticipation of the Virtual Asset User Protection Act slated for July, underscoring the government’s commitment to creating a safer trading environment.
Zero Tolerance for Hacked Tokens
A pivotal aspect of the forthcoming guidelines is the uncompromising stance on virtual assets compromised by hacking or security breaches. To qualify for listing, affected tokens must not only elucidate the incident’s causality but also ensure full recovery of the damages incurred. This development follows a series of hacking incidents targeting domestic virtual asset projects, leading to significant financial losses and the delisting of compromised coins from DAXA-affiliated exchanges.
Raising the Bar for Overseas Assets
The guidelines also address the listing of overseas virtual assets, mandating the availability of a white paper or technical manual tailored for domestic users. Notably, an exemption exists for assets that have been actively traded on international exchanges for more than two years, allowing them to bypass certain listing criteria.
Clarifying Delisting Criteria
Additionally, the new regulations outline explicit standards for the delisting of virtual assets. Projects that fail to meet disclosure obligations or present discrepancies in distribution volumes will face removal from exchanges. This measure aims to foster transparency and accountability within the cryptocurrency market.
A Transformative Period for South Korea’s Crypto Landscape
As South Korea navigates the complexities of regulating digital currencies, the nation’s financial watchdog, led by Lee Bok-hyun, is also contemplating the approval of spot Bitcoin exchange-traded funds (ETFs). With the general election looming, cryptocurrency regulation has emerged as a pivotal issue, drawing attention from the nation’s major political factions, each presenting divergent strategies to institutionalize crypto assets.
In the midst of these regulatory advancements, South Korea stands at the forefront of crafting a secure and transparent cryptocurrency ecosystem, setting a benchmark for global standards in digital asset trading.
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