The South Korean central bank will be capable to access crypto transaction data from exchanges working in the country.
The central bank of South Korea has been presented the green light to ramp up its scrutiny of cryptocurrency service operators and issuers amid further conversations on virtual asset legislation in the country.
On April 20, local media outlet The Korea Herald reported that the Bank of Korea (BoK) will be given the right to investigate operators of cryptocurrency-related businesses.
The South Korean central bank has been competing with the country’s financial regulator, the Financial Services Commission (FSC), over crypto jurisdiction. Still, the FSC will own the final say in governing the rule of the digital asset sector.
The Bank of Korea expressed concerns over financial stability threats from stablecoins and will now be capable to requisition transaction data from crypto exchanges.
The BoK’s right to request data from digital currency operators was verified by an official from the National Assembly’s Political Affairs Committee last week. The FSC will raise its official position at a subcommittee meeting on April 25.
The gathering will accelerate the rollout of South Korea’s virtual asset acts, according to the report.
Democratic Party lawmaker Kim Han-gyu, who offered the country’s crypto rules, the Crypto Assets Act, told “ The Financial Services Commission admits that it's required for the Bank of Korea to have the right to requisition data, but it's refusing to include it in the bill. ”
The South Korean government has been trying to drive ahead crypto legislation but there have been arguments between the central bank and the FSC over who should control it.
Still, the FSC warned that if the central bank governs crypto it'll send the communication that digital assets have the same standing as traditional finance. The FSC chair has preliminarily told that he doesn't consider crypto a financial asset.
The two institutions have been at loggerheads for the past three years over crypto rules. The FSC has been accused by officials from the Political Affairs Committee, a division of the country’s State Affairs Commission, of trying to monopolize its position as a crypto regulator.
The latest development means that both the South Korean central bank and its financial regulator will be capable to investigate crypto operators and have full access to transaction data.
Related: South Korea saw over $4B unregistered crypto transactions in 2022
The FSC has been active newly with enforcement actions against crypto companies and takes the equal position as the United States Securities and Exchange Commission in that it considers crypto assets securities.
South Korea’s Financial Supervisory Service, which operates under the FSC, published an investigative body called the Digital Assets Committee in mid-2022.
(MARTIN YOUNG, Cointelegraph, 2023)