In a significant regulatory move, South Korea has announced plans to conduct a thorough review of approximately 600 cryptocurrencies listed on local exchanges, starting July 19. This initiative is part of the country's efforts to enhance compliance and security within its digital asset market under the new Virtual Asset User Protection Act. The act introduces stringent measures to ensure that all listed cryptocurrencies meet robust standards for reliability, security, and regulatory adherence.
Under the new framework, cryptocurrencies will undergo biannual reviews followed by quarterly assessments to maintain compliance with nine key screening criteria. These include issuer reliability, user protection mechanisms, technology security levels, and adherence to domestic laws. Cryptocurrencies failing to meet these standards risk suspension of transaction support, reflecting South Korea's commitment to market transparency and investor protection.
The regulatory overhaul is expected to have a significant impact on South Korea's crypto market, which hosts 29 domestic exchanges including major players like Upbit. With altcoins constituting over 60% of trading volume, the measures could lead to the delisting of assets with low trading volumes or inadequate disclosures. This move aims to create a more secure and reliable cryptocurrency ecosystem in South Korea, aligning with global trends towards stricter digital asset regulation.
Stay tuned as these developments unfold, shaping the future landscape of cryptocurrency trading in South Korea and potentially influencing regulatory approaches worldwide.
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