Thu, July 04, 2024 at 10:35

• 

  Kang-hoon

  • Hello, Annie.

  • Today, I want to discuss the recent regulatory crackdown on crypto trading in South Korea.

  • This move has caused significant pressure on crypto trading and exchanges, leading to increased uncertainty among traders.

  • 
• Annie

  • Oh, really?😮 What exactly are the regulators doing?

  
• 

  Kang-hoon

  • The Financial Supervisory Service (FSS) of South Korea announced today that they are implementing a system to increase oversight and monitor unusual crypto trading activities.

  • This is part of the new digital asset law that will take effect on July 19.

• Annie

  • That sounds serious.

  • How are the crypto exchanges responding?

  
• ADward

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• 

  Kang-hoon

  • Crypto exchanges have been notified to feed data and details into this new system.

  • The Digital Asset Exchange Alliance (DAXA) has denied any plans for mass delisting but has initiated a 6-month review of over 1,300 digital assets to ensure compliance with the new legislation.

• Annie

  • Wow, that's a lot of assets to review!

  • Are there any specific challenges mentioned for certain types of cryptocurrencies?

  
• 

  Kang-hoon

  • Yes, indeed.

  • Matt Younghoon Mok, a senior foreign attorney and partner with Lee & Ko in Seoul, mentioned that the FSS guidelines could pose significant challenges for altcoins that cannot swiftly comply with the regulatory requirements.

• Annie

  • What kind of activities are they looking to monitor?

  
• 

  Kang-hoon

  • They are focusing on trading over normal volume and price ranges, large transactions, and relatively slow execution.

  • These are considered red flags that could lead to severe penalties.

• Annie

  • I see.

  • How significant is South Korea in the global crypto market?

  
• 

  Kang-hoon

  • South Korea holds a prominent position in the global crypto market.

  • Recently, the Korean won surpassed the US dollar as the most-used currency for crypto trading.

  • About 10% of the country's population has exposure to digital assets, with smaller coins comprising the bulk of trading rather than Bitcoin.

• Annie

  • That's quite impressive.

  • How are the top crypto exchanges in South Korea performing?

  
• 

  Kang-hoon

  • According to the latest report by Korea Forbes, Upbit and Bithumb are the top-ranked crypto apps in South Korea.

  • However, trading volumes have declined across these top crypto exchanges, as per Kaiko.

• Annie

  • Given all this, do you think this regulatory crackdown is a good or bad thing for the market?

  
• 

  Kang-hoon

  • In my view, this regulatory crackdown is a negative development for the market.

  • 

  • The increased oversight and stringent guidelines could delay the global crypto market recovery.

  • The uncertainty and potential penalties may deter traders and investors, leading to reduced trading volumes and market activity.

  • Upon comprehensive consideration, this news is perceived as a 😱Bearish.