On October 6, Kim Yongtae, the head of Fintech Innovation Department(FID) at the Financial Supervisory Service(FSS), said, “it is difficult to follow existing laws due to the volatility of the digital assets” during the ‘Direction of Digital Asset and Financial Transaction Policy Seminar.’

He said, “Korea is moving on the principle of supporting blockchain technology but regulating digital assets. It is reliable in that all transaction details are recorded in the distributed ledger; however, the price volatility of digital assets are so severe that we have no other choice.

Previously Mt. Gox had a hacking attack. The amount of loss at the time of hack was 120 billion KRW which has jumped to 2 trillion KRW now because of the price changes in the digital assets. Finance is a regulated business. Assets with such high volatility will be difficult to incorporate into the existing financial system.

However, we are actively sponsoring blockchain based enterprises under regulatory sandbox such as Casa Korea’ digital real estate beneficiary securities platform and Koscom’s blockchain based shareholder list renewal project.”

Director Kim also mentioned about ‘The Law on Specific Financial Information Reporting and Use.’

He said, “The purpose of the law is to impose obligation of AML(Anti Money Laundering) on VASP(virtual asset service providers) and banks. When the enforcement decree is executed, VASPs will have to report according to the requirements within 6 months from March 25th 2021. We will also be collecting feedbacks of the enforcement decree from the private sectors.”

Translated by Young Hwang