BUSINESS

Korea seeks to regulate digital currencies

By Yonhap
  • Published : Sept 3, 2017 - 13:47
  • Updated : Sept 3, 2017 - 13:47

South Korea's top financial regulator said Sunday it will step up monitoring and carry out probes into money laundering, unauthorized financing and other illicit transactions of digital currencies.

Joining Japan, China and other Asian nations in trying to regulate crypto-currencies, the Financial Services Commission  warned that the recent transaction volume and volatility of digital currencies are "excessive."

The move by the FSC comes as the price of a bitcoin, the best-known digital currency, surged above $4,000 last month. 

(123RF)

South Korea is home to one of the world's largest bitcoin exchanges, with about 1 million people estimated to have the digital currency.

"There is a need for the government to cope with the virtual currencies to prevent them from being used as tools for crimes and simple speculative investment," the state regulator said in a statement.

Despite a boom in transactions of digital currencies, the exchanges of such are largely unregulated as they are not recognized as financial products. Also there are no rules protecting people who invest in digital money.

As part of regulations against illicit transactions of digital currencies, banks will be required to strictly check the personal information of people who work at digital currency exchanges, the FSC said.

If there are suspicious transactions in such bank accounts, lenders will be required to report the transactions to authorities, it said.

If a small money-transfer operator wants to send money overseas using digital currency, the operator will report their daily transfer records to the Bank of Korea, the FSC said. (Yonhap)