Yesterday, the FSC submitted a basic outline for the national assembly’s consideration in constructing the new virtual asset industry law. It centers around 10 proposals from lawmakers on virtual assets. While the existing Act on Reporting and Use of Certain Financial Information focuses mainly on anti-money laundering in crypto, the new law sets out to supervise the market and the industry in a more comprehensive way.
The FSC’s report includes sanctions against unfair trade practices such as the use of undisclosed information, market price manipulation, or fraudulent transactions. Those with unfair profits of more than 5 billion won (about US$4.2 million) may be sentenced to more than five years in prison; those with more than 500 million won (US$421,620.71) and less than 5 billion won may be sentenced to more than three years in prison; and those with less than 500 million won may be sentenced to more than 1 year. The fine is three to five times the unjustly earned profit, regardless of the amount.
It also mandates virtual asset businesses to disclose white paper , token evaluation, legal and business reports. It says that any in violation of this will face criminal punishment as well. The FSC also suggested that the virtual asset industry sets up a legal association for self-regulation and dispute settlement within the crypto industry.
FSC chairman Koh Seung-beom spoke yesterday underlining the importance of continuously updating the relevant policies in new industries such as in virtual assets, and stressed that the authorities need to strengthen the supervision and guidance on the novel industry.