In a move to enhance transparency and address potential conflicts of interest, the Financial Services Commission (FSC) of South Korea has introduced regulations requiring its internal employees to report their crypto holdings.
Quick facts:
- South Korea’s FSC has directed its employees to report their crypto holdings as part of regulatory efforts in the country.
- The reporting requirement applies to FSC employees involved in virtual assets and those who have performed related duties in the past six months.
- The move aims to enhance transparency and accountability, aligning with South Korea’s proactive approach to cryptocurrency regulation.
The new measures are part of the second phase of legislation aimed at strengthening oversight within the crypto market.
In accordance with the Specific Financial Information Act, the FSC has issued an administrative notice directing its employees to report their crypto assets, as reported by a local publication.
This reporting requirement applies to employees currently involved in virtual asset-related roles as well as those who have performed such duties in the past six months.
The objective of the regulation is to promote integrity and prevent any potential improprieties among government officials. By mandating the reporting of crypto holdings, the FSC aims to ensure transparency, mitigate the risk of insider trading, and maintain a fair and accountable environment.
South Korean Employees to Disclose Holdings
Affected employees will need to provide detailed information about their crypto assets, including the type of assets, acquisition dates, quantities held, and corresponding values. These reporting guidelines will enable authorities to monitor employees’ crypto holdings and identify any potential risks or conflicts of interest.
The FSC intends to complete the revision and implementation of the regulations during the second half of the year, following the administrative notice and subsequent employee reporting. This phased approach allows for a comprehensive evaluation and ensures effective oversight and compliance.
South Korea will Launch New Rules on Fundraising and Distributions
South Korea’s proactive approach to crypto regulation continues with the implementation of reporting requirements for employees. The second phase of legislation is here, and the focus will shift to fundraising and distributions, particularly Initial Coin Offerings (ICOs).
The ongoing research conducted by the FSC will inform discussions on these matters, with completion expected by August.
These regulatory measures form part of South Korea’s broader efforts to safeguard investors and establish a robust legal framework for digital assets. The recently approved Virtual Asset User Protection Act, set to take effect in a year, will impose strict requirements on crypto service providers, including asset protection, insurance, offline storage, and transaction records.
The involvement of the Bank of Korea, the country’s central bank, in requesting data from cryptocurrency platforms further demonstrates the need for proper oversight of the crypto market.
