South Korea’s executive power and ruling party have urged the cryptocurrency industry to take what authorities describe as a voluntary regulatory action, Korean media reports revealed. The call came during a council meeting dedicated to crypto assets.
Government Calls on South Korea’s Crypto Sector for Regulatory Proposals
Representatives of the South Korean government and the ruling People’s Power Party met on Monday to discuss issues related to the crypto space. The talks were held in the aftermath of the collapse of the Terrausd (UST) algorithmic stablecoin and its sister coin Terra (LUNA) last month, which affected many Koreans.
Aiming to prevent the negative effects of such a crash and better protect investors, South Korean officials and lawmakers are currently considering adopting a new law for blockchain-based platforms, Arirang revealed. They are also urging the crypto industry to come up with its own regulations, including safety mechanisms.
The English-language TV network’s report noted that South Korea’s crypto asset market was 55.2 trillion Korean won, or about $43 billion, at the time of writing. Additionally, the 24 licensed cryptocurrency exchanges in the country process an average of 11.3 trillion won (over $8.7 billion) of transactions per day, reflecting the rapid growth of the market over the past few years.
However, South Korean authorities believe that current regulations are insufficient to deal with the rapid expansion. That is why the government and influential South Korean political forces are calling on the sector to propose “voluntary regulatory measures” as many other countries are considering the impact of digital currencies on their financial systems and economic policies.
Arirang added that more than a dozen crypto-related bills are currently pending in Korea’s National Assembly, and that Korea’s Financial Services Commission will propose more laws tailored to protect investors from crypto market gyrations.
At the same time, Financial Supervisory Service President Lee Bok-hyun is quoted as stressing the need for a rational regulatory system. Such would allow the crypto asset market to have the responsible growth he described.
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