Digital assets that fit the descriptions for security tokens will be regulated under the country’s Capital Markets Act.
South Korea has established guidelines outlining the types of digital assets to be considered and classified as securities in the country.
In a press release, the Financial Services Commission (FSC) pointed out those digital assets that meet the characteristics listed in the country’s capital market law will be considered safe. This policy treats securities as financial investments where investors are not required to pay additional fees after their initial investment.
In addition, the FSC has also developed examples of digital assets that will be classified as safe. According to the FSC, this may include trademarks that contribute to commercial operations, give their owners the right to dividends or residuals, or provide profits that the company produces to those investing.
Cryptocurrencies that fit the definition of security tokens will be governed by the country’s capital markets laws. Meanwhile, digital assets that do not match the characteristics of security will be governed by other standards to come.
According to the FSC, token issuers and traders such as crypto exchanges will be responsible for conducting an audit to classify crypto as a security based on standards. The organizer also emphasized that the assessment will be on a case-by-case basis.
The finance minister also said that the new guidelines are part of the preparation for the ordering and distribution of safety equipment in the country. South Korea is an active player in the crypto ecosystem, and various sectors in the country continue to grow.
On Jan. 19, the city of Busan unveiled plans to establish a decentralized digital goods exchange. Officials said the platform is scheduled to begin operations this year. Apart from this, the Ministry of Justice in the country is also planning to introduce a crypto-tracking system. On January 29, the South Korean government said it would introduce a monitoring system aimed at combating money laundering and recovering money linked to the crime.
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