The central bank of South Korea has been given the clearance to expand its investigation of cryptocurrency service operators and issuers in the midst of further discussions on virtual asset legislation in the country.
As reported by local media outlet The Korea Herald , The Bank of Korea (BOK) will be given the right to scrutinize operators of cryptocurrency-related businesses.
The South Korean central bank has been contesting with the country’s financial regulator, the Financial Services Commission (FSC), over crypto jurisdiction. However, the FSC will have the final say in governing the regulation of the digital asset sector.
The Bank of Korea puts forth its concerns over risks of financial stability from stablecoins and will now be able to request transaction data from crypto exchanges.
An official from The National Assembly’s Political Affairs Committee last week confirmed the BoK’s right to request data from digital currency operators.The FSC is expected to convey its official position at a subcommittee meeting on April 25.As per the report, the meeting will accelerate the rollout of South Korea’s virtual asset laws.
Kim Han-gyu, a lawmaker from democratic party, who initiated the country’s crypto regulations, the Crypto Assets Act, said “The Financial Services Commission admits that it is necessary for the Bank of Korea to have the right to request data, but it is refusing to include it in the bill.”
There have been arguments between the central bank of korea and FSC over who should control the crypto legislation that is causing hurdles in pushing forward of crypto legislation.
As suggested by the FSC it warns that if the central bank governs crypto it will send the message that digital assets have the same standing as traditional finance. The FSC chair has previously said that he does not consider crypto a financial asset.
The two institutions strongly disagree for the past three years over crypto regulations. The officials from the Political Affairs Committee summons FSC, a division of the country’s State Affairs Commission, for trying to monopolize its position as a crypto regulator.The latest development means that both the South Korean central bank and its financial regulator will be able to investigate crypto operators and have full access to transaction data.
The FSC has been in action lately with execution actions against crypto companies and takes the same position as the United States Securities and Exchange Commission (SEC) in that it considers crypto assets securities.