Governor Regulates Bitcoin as Commodity in South Korea

Bank of Korea Governor to Regulate Bitcoin as Commodity in South Korea

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As the governor of the South Korean central bank (BOK), Lee Joo-yeol announces that Bitcoin will be implemented as a commodity, comparatively rather than a currency. However, the governor claims that the regulation will not launch anytime soon.

During the audit of BOK by the National Assembly, Lee claimed that digital currencies like Bitcoin cannot be regarded as money based on the definition of the Bank of International Settlements (BIS).

Additionally, Lee claims based on the meaning of the Bank of International Settlements (BIS), that digital currencies such as Bitcoin cannot be treated as money.

“Approval of virtual currencies is inappropriate because it is regarded at a level of a currency rather than a commodity.”

The latest actions by South Korea

In 2016, the South Korean government created a digital currency task force to analyze the regulation and licensing boundaries for Bitcoin-related exchanges to deal with the problems involving cryptocurrency immediately. A CNN reported broadcasted in early June 2017 states that the contributors in the study disagreed on whether cryptocurrencies should be included and how the existing systems would work upon inclusion.

Meanwhile, South Korea’s financial regulator, the Financial Supervisory Service (FSS) has issued a ban on initial coin offerings (ICO) guided by the task force. The ban aims to protect investors from possible fraud. This move has led to worries of a campaign against the local digital currency trading market in the country that is similar to the crackdown recently launched by the Chinese government.

South Korea’s financial advisor, the Financial Supervisory Service (FSS) launched a restriction on initial coin offerings (ICO) handled by the task force. The goal of the boycott is to protect shareholders from potential fraud. These actions led to the distress of the campaign against local digital currency market in the country, similarly to the strike currently launched by the Chinese government.

Kim Yong-bum, the FSS vice chairman, recently stated that ICOs increase the exposure of fraud. Therefore the ban will be implemented.

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