South KoreaTL;DR Breakdown
- After four years, South Korea set to overturn ICO ban.
- Authorities want ICOs to be closely regulated.
- Korea banned ICO’s in 2017 owing to financial crimes.
After previously placing a ban on initial coin offerings (ICOs) in 2017, South Korea has begun mulling, lifting the ban, and putting in measures to regulate the sector.
Korea country’s financial regulatory agency made this call for them to include crypto token fundraising in the country’s Capital Market Act.
According to a local report in South Korea, Do Gyu-sang, vice chairman of South Korea’s Financial Services Commission (FSC), wants fast action on ICO in the country.
When he appeared before the Political Affairs Committee of the South Korean National Assembly, Mr. Do made a case that ICOs must be included in the country’s Capital Market Act.
South Korea requirement for ICO regulation
He said ICO regulation would require a re-examination of applicable financial reporting requirements. The FSC vice-chairman listed white papers, investor prospectuses, and security declarations, among other possible reporting obligations for proper regulation of the space when the ban is overturned.
Mr. Do noted that the documents should include sections devoted to detailed project descriptions, virtual asset class, information about major backers, and underlying technology, among others.
The FSC VP also called for detailed information on transaction risks, associated taxes, and fees in a paper submitted to the Political Affairs Committee.
Why Korea banned ICO in 2017
South Korea’s Financial Services Commission has announced that all initial coin offerings (ICOs) will be banned in November 2017.
“All kinds of initial coin offerings (ICO) will be banned as trading of virtual currencies needs to be tightly controlled and monitored, they said.
“The decision to ban ICOs as a fundraising tool was made as the government sees such issues as increasing the risk of financial scams.” For any parties involved in the issuance of ICOs, there will be “stern penalties,” the authority said that year.
The country banned ICO’s after China banned ICOs in September 2017 after cracking down on several Bitcoin exchanges then.
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