With the new president-elect Yoon Suk-yeol proclaiming the legalisation of cryptocurrency fundraising, South Korea has become the latest country to reform cryptocurrency regulations and remove the ban on Initial Coin Offerings (ICOs).
According to reports, the Financial Supervisory Service (FSS) of South Korea is preparing to create crypto surveillance tools to monitor the risks connected to crypto assets on a regular basis.
The FSS is working on a number of efforts to address this year’s hazards in the virtual asset market, according to FSS Governor Lee Bok-hyun. Regarding the crypto monitoring tool, he stated that although authorities presently lack information to identify possible problems in the crypto market, the crypto market is anticipated to grow increasingly closely tied to conventional financial markets.
Data security, more than anything else, is crucial for anticipating hazards in the virtual asset market, Lee emphasised. The agency also intends to create new disclosure requirements for businesses engaged in cryptocurrency-related activities.
The director also pointed out that no financial institution in Korea directly offers services connected to cryptocurrencies, and that despite the virtual asset market’s expansion, its direct influence on the stability of the financial system is still minimal. However, if the size of Korea’s domestic cryptocurrency market expands, so will the impact it has on the country’s financial stability.
Numerous nations are implementing extensive regulatory measures to stabilise their markets in the wake of the Terra-Luna catastrophe. The bitcoin market is also getting more interconnected with conventional financial markets.