With Governments desiring to introduce some form of cryptocurrency regulation, South Korea is mulling over a technology-specific scheme as part of its endeavor to regulate cryptocurrency exchange.
Sources at BusinessKorea indicate that such rules could be introduced soon or at least subjected to a debate. These rules are akin to New York’s controversial ‘BitLicense’ that was introduced in 2015. The introduction of this exchange approval system is just an addition to the existing regulations passed before.
However, this latest move by the South Korean government is interpreted by crypto enthusiasts to mean a softened stance towards cryptocurrencies. This is so because some regulators had proposed a total shut down of cryptocurrency exchange-based trading, just like China had done. South Korea had already banned the use of anonymous accounts in crypto trading, with synchronization of real bank accounts with the virtual money trading accounts.
The BusinessKorea source further intimated that there is also a plan to introduce taxes instead of imposing further regulations. The source further said that a final decision regarding cryptocurrencies will arrive only after the local elections are over and done with.
The New York State Department of Financial Services’ (NYDFS) regulatory framework (BitLicense) spells out that there shall be no company or individual who shall offer cryptocurrency services as a custodian or exchange without a license for doing so. Their operations must also be in strict compliance with the money transmitter regulations.
The licensing costs have been considered by many operators as prohibitive and have led to only a small number of exchanges operating in New York others have even fled the state altogether.