Business 12 January 2018

Ed Drake

South Korean cryptocurrency exchange laws ‘not finalized’

The office of the President of South Korea announced that plans to ban cryptocurrency exchanges in the country are ‘not finalized’, in a move that appears to roll back on indications given over the last few days.

Following media reports on Wednesday that plans to ban exchanges were imminent, including comments from Justice Ministry sources confirming legislation would be immediately forthcoming, statements from the President’s office on Thursday confirmed there were presently no concrete plans to restrict the operations of domestic cryptocurrency exchanges.

Addressing suggestions the law was already set in stone, the President’s spokesperson set the record straight, saying, “Justice Minister Park’s comments related to the shutdown of cryptocurrency exchanges is one of the measures prepared by the Ministry of Justice, but it’s not a measure that has been finalized.”

Even if legislation were ultimately brought forward, it is now considered unlikely that measures would receive the required approval from the National Assembly any time soon, effectively kicking the issue into the long-grass.

According to local media reports, the process could take several more months or even years to materialize.

“Legislation for an outright ban of virtual coin trading will require a majority vote of the total 297 members of the National Assembly, a process that could take months or even years,” the reports stated.

The news comes at a time of profound flux in the Korean law around cryptocurrency, after the government indicated it was planning a more direct clampdown on crypto exchange trading.

Suggestions that regulation is imminent have been widely reported in recent weeks, including details of a meeting between government officials and counterparts in Japan and China to discuss a common regional approach.

However, on the strength of today’s comments, it appears as if the policy response from the South Korean government is not as developed as may have been previously suggested.

Concerns over the potential ban in South Korea has sent cryptocurrency markets tumbling over the past 24 hours, amid fears of disruption in one of the most significant global regions for cryptocurrency trade.

Today’s news is expected to be welcomed by cryptocurrency markets, despite persisting concerns over the approach being adopted in South Korea.

Note: Tokens on the Bitcoin Core (SegWit) chain are referenced as BTC coins; tokens on the Bitcoin Cash ABC chain are referenced as BCH, BCH-ABC or BAB coins.

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