New monitoring system to increase oversight of South Korean crypto exchanges
The Financial Supervisory Service (FSS) of South Korea is planning to strengthen its oversight of crypto trading platforms to combat fraudulent transactions. In a notice issued on July 4, the regulator instructed local exchanges to establish a “continuous monitoring system for unfair transactions” and report any “abnormal transactions” using a dedicated communication channel. According to the notice, the FSS collaborated with exchanges to develop the ‘Abnormal Transaction Monitoring Guidelines’ to support the detection and prevention of irregular activities.
This new monitoring system is set to launch on July 19, in alignment with the implementation of South Korea’s Virtual Asset User Protection Act, the country’s first regulatory framework for safeguarding crypto investors.
Mass token delisting unlikely
Simultaneously, the Digital Asset Exchange Alliance (DAXA) and 20 local exchanges have allayed concerns about potential mass delisting of tokens by releasing the ‘Best Practices for Supporting Digital Asset Transactions’ guideline on July 2. The guideline offers a structured approach for exchanges to evaluate and delist digital assets, with a more flexible review process for assets that have been trading on eligible overseas markets with sufficient regulation for over two years.
Previously, reports suggested that South Korean exchanges would review the listing of more than 1,000 altcoins over the next six months to ensure compliance with regulations, causing speculation about mass delistings of up to 600 coins.
South Korea’s proactive stance on crypto regulation is evident in these recent developments. The country is striving to raise the bar for exchange operations and safeguard consumer interests, solidifying its position as a trailblazer in addressing challenges within the crypto industry.
Industry experts believe that these regulatory changes will promote market stability, protect investors, and deter financial crimes in the crypto sector.
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