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South Korean lawyers urge government to establish cryptocurrency laws

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According to a report from Reuters on Thursday, the Korean Bar Association said the government should “quickly” develop blockchain laws in the country to help develop the tech industry and protect investors.

Established in 1952, the KBA is the regulatory authority for the legal professions. Its membership is mandatory for all local lawyers. As of November 2017, 23,557 attorneys and 1,353 law firms are registered member of the KBA.

Speaking at a news conference at the Parliament, Korean Bar Association President Kim Hyun said:

“We urge the government to break away from negative perceptions and hesitation, and draw up bills to help develop the blockchain industry and prevent side effects involving cryptocurrencies.”

In January 2018, the Korea Financial Intelligence Unit (KoFIU) introduced the Virtual Currency Anti- Money Laundering Guidelines. Since then, the KoFIU and the Financial Supervisory Service (FSS) conducted inspections on banks for monitoring their compliance with the guideline and proposed a revision to addressing some insufficiencies related with the implementation of the guidelines.

In July, the Financial Services Commission (FSC), the country’s financial watchdog, set up a new department dedicated primarily to cryptocurrencies and blockchain. Dubbed the Financial Innovation Bureau, it was created to focus on developing policy-making initiatives for the industry.

Also in July, a senior executive at the FSC called on the government to pass a bill regulating domestic cryptocurrency exchanges with urgency in order to counter lax security in the industry.

At the same time, members of a number of Korean political parties were reportedly expected to submit a number of bills focused on regulating cryptocurrencies, initial coin offerings and blockchain. So far, though, there has been no action on the part of the government.

The lack of clear rules is also causing domestic crypto exchanges to increasingly set up in outside jurisdictions, according to The Korea Times in a report today.

According to Reuters, the government said that it would decide its position on blockchain regulation only after the completion of a thorough study, which is currently being conducted by both government and financial regulators.