South Korea to Remain Laissez Faire on Bitcoin, According to FSS
South Korea’s financial watchdog has “no plans” to monitor cryptocurrency trading, according to a new report that circulated in local media. This will continue to be the case until South Korea recognizes cryptocurrency as a legitimate form of money.
FSS Not Likely to Monitor Cryptos
Head of the Financial Supervisory Service (FSS) Choe Heung-sik has made it clear that the oversight body has no intent to monitor or regulate the crypto markets. Choe was quoted by the Korea Times stating: “Though we are monitoring the practice of cryptocurrency trading, we don’t have plans right now to directly supervise exchanges. Supervision will come only after the legal recognition of digital tokens as a legitimate currency.”
The watchdog’s position alleviates some concerns that Seoul was planning to clamp down on the digital currency market. South Korea has quickly emerged as a central hub for cryptocurrency trading, but even that hasn’t stopped policymakers from shutting down initial coin offerings (ICOs). Coin offerings are a highly popular but controversial crowdfunding campaign that have generated well north of $3 billion this year.
Despite being one of the world’s most liquid bitcoin markets, South Korea has a track record of charging a higher premium for the digital asset. According to CCN, the premium was as high as $500 earlier this month.
The country is home to some of the world’s biggest cryptocurrency exchanges, such as Bithumb, which recently experienced an outage that cost investors billions of won. As CCN states, every single cryptocurrency that was listed by Bithumb has succeeded, including Zcash and Qtum.
Valued at $1 billion, Qtum is the world’s twelfth largest digital asset by market cap. Meanwhile, Zcash clocks in at no. 15 with $836 million. A total of twelve digital currencies are valued at $1 billion or more, according to CoinMarketCap. The total value of all 1,200 or so digital currencies in circulation is more than $250 billion.
Daily trading volumes on South Korean exchanges has reached 2 trillion yuan, which is equivalent to roughly $1.4 billion USD. Industry data shows that the yuan is the third most traded fiat currency following the Japanese yen and U.S. dollar.
Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
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