South Korea banks and lawmakers call for new digital currency legislation

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Senior officials at South Korea’s leading banks have called for more regulation on digital currencies, in a bid to support the long-term development of the industry within the country.

Banking leaders were reportedly joined by members of Korea’s National Assembly at a recent event, with discussions surrounding the need for a “virtual asset business law.” Titled “The National Assembly Seminar for the Virtual Asset Business Law,” the event argued the laws were needed to protect revenues and help develop the fledgling digital currency sector in Korea.

Rep. Kim Byeong-wook of the Democratic Party, the secretary of the National Policy Committee, chaired the event, which was put together in partnership with cryptocurrency lender Delio.

In opening remarks, Kim said it was up to lawmakers in the National Assembly to consider how best to legislate, to achieve the dual goals of structure for industry and protection for investors. Kim said digital currencies should have the “widest possibilities in the post-COVID-19 era,” referencing the growth in cashless payments and a shift away from paying in cash.

The calls were welcomed by representatives of Korea’s private banking sector, also in attendance at the event.

Jang Hyeon-gi, head of R&D at Shinhan Bank, said more banks would be willing to provide their own digital currency services once legislation was in place. Shinhan Bank already offers a range of digital currency services to its clients, including digital custody and digital currency payments.

Jo Jin-seok, head of the IT Innovation Center at KB Kookmin Bank, said it was expected that more assets would become digitized, with many banks likely to eventually release their own digital currency platforms.

The National Assembly is expected to begin discussions around new laws for blockchain in late October 2020, ahead of plans for a central bank digital currency launch before the end of 2021.

To learn more about central bank digital currencies and some of the design decisions that need to be considered when creating and launching it, read nChain’s CBDC playbook.

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