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South Korea Strengthen Regulation of Crypto Market Regularly Check Crypto Market Risks

2023-01-20 Brokersview

South Korea's Financial Supervisory Service (FSS) is reportedly planning to develop crypto surveillance tools to regularly check risks associated with crypto assets.


Lee Bok-hyun, FSS Governor said the FSS is working on various initiatives for this year's virtual asset market risks. Regarding the crypto monitoring tool, he said the crypto market is expected to become more closely linked to traditional financial markets, but regulators currently lack data to identify potential risks in the crypto market.


"In order to preemptively respond to risks in the virtual asset market, securing data is more important than anything else," Lee stressed. In addition, the regulator plans to establish a new disclosure obligations in business related to crypto business.


The director also noted that no financial company in Korea directly provides crypto-related services, and that despite the growth of the virtual asset market, the direct impact on the stability of the financial system is still low. However, as the domestic cryptocurrency market in Korea grows in size, its impact on financial stability will continue to increase.


In the wake of the Terra-luna collapse, many countries are introducing comprehensive regulatory measures to stabilize their markets. Traditional financial markets are also becoming more connected to the cryptocurrency market.