The Financial Services Commission (FSC) of South Korea has announced that the Act on the Protection of Virtual Asset Users took effect on July 19.
This follows the March 2021 revision of the Act on Reporting and Using Specified Financial Transaction Information, which required virtual asset service providers (VASPs) to register with financial authorities and implement various anti-money laundering measures, such as the travel rule.
However, these measures were insufficient to address unfair trading practices, like price manipulation, and to ensure the safety of users’ assets. To enhance protection, the Virtual Asset User Protection Act was passed on July 18th last year, incorporating key points from 19 legislative bills pending in the National Assembly.
Over the past year, additional regulations were developed, allowing VASPs time to prepare for the new law’s implementation on July 19, 2024. The Virtual Asset User Protection Act encompasses several crucial areas: it protects users’ deposits and crypto assets, regulates unfair trading activities, and grants financial regulators the authority to supervise, inspect, and sanction VASPs.
These comprehensive regulations aim to provide better protection for virtual asset users in South Korea, ensuring a safer and more transparent crypto market.
