The Head of the Financial Supervisory Service (FSS) of South Korea, Lee Bok-hyun, plans to meet with Gary Gensler, the Chairman of the U.S. Securities and Exchange Commission (SEC), in January next year to discuss issues such as cryptocurrency regulation and the extradition of Do Kwon.
According to a report by Chosunbiz, a South Korean news media, on December 18th, Lee Bok-hyun, the head of the FSS, will visit the SEC in January next year and plans to have a meeting with Chairman Gary Gensler. The main topics of this meeting will include discussions on the current state and regulatory policies of the cryptocurrency market, and possibly the extradition issue of Do Kwon, the founder of Terra.
How will the meeting with the SEC affect South Korean regulation?
South Korean officials stated that this meeting is a good opportunity for the local financial regulatory institution. Director Lee hopes to gain insights into the management and regulatory methods of the global virtual asset market through the visit to the U.S. SEC, which leads the global virtual asset market regulatory system. This will help South Korea establish its role in regulating virtual assets and possibly discuss the framework for cross-border regulation.
In July of this year, the South Korean National Assembly passed the “Virtual Asset User Protection Act” to enhance investor protection. The law integrates 19 related laws on cryptocurrency assets, defines digital assets, and establishes penalties for illegal activities such as insider trading, market manipulation, and unfair trading.
The law is expected to come into effect in July 2024, but the specific plans for whether virtual assets are classified as securities and how to manage and regulate them are still inadequate.
In late November, the South Korean Financial Supervisory Bureau announced the establishment of the “Virtual Asset Supervision Bureau” and the “Virtual Asset Investigation Bureau.” According to reports, the Virtual Asset Supervision Bureau will be responsible for overseeing the virtual asset field, including regulating virtual asset business operators, conducting supervisory inspections, market monitoring, and improving systems. In addition, they plan to establish a regulatory system for virtual assets to promote market stability.
The Virtual Asset Investigation Bureau will be a department dedicated to investigating improper transactions and focusing on combating market disruption, with the core mission of preventing market disorder and protecting users from damages.
So far, the virtual asset market in South Korea has been primarily regulated by the Financial Intelligence Unit (FIU) under the Financial Services Commission. They are responsible for reporting matters related to virtual asset business operators. On the other hand, the Financial Supervisory Bureau only has a digital asset research team, which mainly focuses on supporting virtual asset regulations, conducting market research and monitoring. Through the establishment of these new departments, the financial regulatory institution plans to strengthen its role in the virtual asset market.
Possible discussion on Do Kwon’s extradition issue
In addition to regulatory issues, the extradition issue of Do Kwon, the co-founder of Terraform Labs, is also a point of divergence between the United States and South Korea.
Originally, Montenegro had approved Do Kwon’s extradition request, and it would be up to the Minister of Justice to decide whether to extradite him to the United States or South Korea. However, the court rejected the approval and announced that it would be re-examined next year. Therefore, where Do Kwon’s next destination will be may also become one of the discussion topics of this meeting.
Related articles:
Breaking News: Do Kwon’s extradition request to the United States and South Korea overturned by Montenegro court, to be retried next year. [Image]
Related reports:
SEC reveals crucial private messages from Do Kwon: “I can manipulate trading volume! As long as you don’t tell, I won’t say…”
Lawyer: It’s difficult to classify LUNA as a security, high probability of “innocent release” for Do Kwon if he returns to South Korea.
Do Kwon refuses extradition by the U.S. SEC! Retorts, “Impossible” and prefers to remain in a Montenegro prison.
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Do Kwon
Gary Gensler
SEC
SEC Chairman
Lee Bok-hyun
South Korean regulation
Financial Supervisory Commission of South Korea