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NOV 29, 2023

Korea’s financial regulator establishes dedicated units for crypto oversight

by CoinNess Global

The Financial Supervisory Service (FSS) of South Korea revealed in a Wednesday (local time) press release that it is introducing new units specifically focused on virtual asset matters. This move is in anticipation of the upcoming implementation of the Virtual Asset User Protection Act scheduled for next July. The establishment of these dedicated organizations is a strategic step towards bolstering the integrity of the crypto market, with the goal of enhancing consumer protection.

Supervision and investigation bureaus

The newly established units will be known as the Virtual Asset Supervision Bureau and the Virtual Asset Investigation Bureau. These units are being created in response to the burgeoning crypto market.
The Supervision Bureau will be responsible for extensive oversight of cryptocurrencies. Its roles will include supervising and inspecting virtual asset service providers (VASPs), monitoring market activities and enhancing policy and regulations in the sector. Additionally, the bureau is tasked with ensuring the effective implementation of these regulations and contributing to the promotion of market stability.
The Investigation Bureau, the other key component of the new structure, will concentrate on identifying and addressing market abuse activities in the cryptocurrency sector, specifically targeting unfair trading practices.
Until now, the Financial Intelligence Unit (FIU) of the Financial Services Commission (FSC) has played a leading role in overseeing the crypto sector, primarily due to its responsibility in evaluating applications from VASPs.

FSS’s greater role in crypto oversight

The FSS, on the other hand, has maintained a digital asset research team, which has been responsible for supporting virtual asset legislation, along with conducting market analysis and monitoring. However, the latest move is set to the FSS’s role in regulation and oversight within the crypto market.
The Supervision Bureau will be under the leadership of Lee Hyun-duk, who currently serves as Head of Financial Investment Examination Department 2. Meanwhile, Moon Jung-ho, the present leader of Audit Oversight Department 1, will take charge of the Inspection Bureau. The process of appointing team members to these bureaus is scheduled to take place in early January.
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