Seoul keeps in­vestors guess­ing on do­mes­tic cryp­tocur­rency reg­u­la­tion

Arab News - - BUSINESS -

SEOUL: South Ko­rea has yet to de­cide how to reg­u­late cry­po­tocur­rency trad­ing, a se­nior gov­ern­ment of­fi­cial said, high­light­ing Seoul’s strug­gles to su­per­vise a mar­ket that crit­ics said re­mains opaque and vul­ner­a­ble to risks such as money laun­der­ing.

“The gov­ern­ment hasn’t made any con­clu­sion yet. Suf­fi­cient con­sultations should come first,” Hong Nam-ki, min­is­ter of of­fice for gov­ern­ment pol­icy co­or­di­na­tion, told par­lia­ment on Tues­day.

Hong said the gov­ern­ment’s pri­mary de­sire is to foster trans­parency in cryp­tocur­rency trad­ing, with reg­u­la­tors mon­i­tor­ing any il­le­gal ac­tiv­ity.

None­the­less, a de­ci­sion on whether to ban trad­ing in ex­changes or bring them on to the main­stream re­mains a con­tro­ver­sial sub­ject, he said.

Asia’s fourth-largest econ­omy has be­come a hub for vir­tual cur­rency trad­ing with even house­wives and stu­dents ea­gerly em­brac­ing the mar­ket. Global pol­i­cy­mak­ers have warned that in­vestors should be cau­tious given the lack of broad reg­u­la­tory over­sight.

Seoul has given con­flict­ing sig­nals on how it might reg­u­late cryp­tocur­rency trad­ing. Au­thor­i­ties have ap­peared to row back from ear­lier warn­ings of a pos­si­ble ban of do­mes­tic vir­tual cur­rency ex­changes, although Hong’s lat­est com­ments high­light the po­ten­tial dis­agree­ments among of­fi­cials on im­ple­ment­ing a broad reg­u­la­tor frame­work.

South Ko­rea’s reg­u­la­tor last week promised nor­mal­iza­tion in cryp­tocur­rency trade and sig­naled a will­ing­ness to help pro­mote blockchain tech­nol­ogy.

In Jan­uary, the coun­try’s cus­toms an­nounced it had un­cov­ered il­le­gal cryp­tocur­rency for­eign ex­change trad­ing worth nearly $600 mil­lion, high­light­ing the risks in­volved in the mar­ket.

The height­ened reg­u­la­tory scru­tiny around the world has seen bit­coin plunge more than 65 per­cent this year. —

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