South Korean government approves landmark bill to regulate cryptocurrency assets

TL;DR Breakdown

  • South Korea’s National Assembly has passed a bill requiring officials to disclose their cryptocurrency holdings.
  • The legislation was prompted by a scandal involving a former lawmaker who held significant cryptocurrency assets.
  • The “Kim Nam-guk Prevention Law” was initiated to ensure senior officials report any crypto holdings exceeding $760.

South Korean lawmakers have taken a significant step forward in regulating cryptocurrency assets by passing a bill that requires officials to disclose their holdings. The unanimous approval of the bill by the National Assembly signifies the government’s commitment to tackling cryptocurrency-related issues.

The amendments to the National Assembly Act and the Public Service Ethics Act addressed concerns over a recent scandal involving lawmakers engaging in large cryptocurrency transactions.

With overwhelming support from the present lawmakers, the amendment to the National Assembly Act now mandates the inclusion of cryptocurrencies in the list of registered properties legislators hold.

Additionally, the amendment to the Public Officials Ethics Act obligates high-ranking officials and members of the National Assembly to report their cryptocurrency assets. The intention behind these legal changes is to prevent illicit activities such as money laundering, conflicts of interest, and the use of insider information.

The catalyst for these swift actions was the revelation that Kim Nam-kuk, a former member of the main opposition Democratic Party, held significant cryptocurrency assets worth at least $4.5 million.

This discovery raised concerns and highlighted the need for stricter regulations. In response, the South Korean government promptly initiated the “Kim Nam-guk Prevention Law,” aiming to ensure that all senior officials report any crypto holdings exceeding $760, treating them similarly to cash, stocks, bonds, and other assets.

Initially, the legislation was scheduled to take effect in December 2023, following a six-month grace period. However, Representative Yun Jae-ok from the People Power Party and other lawmakers advocate for earlier implementation, suggesting July as the enforcement date.

The bill’s unanimous passage underscores the government’s commitment to ensuring transparency and accountability among public officials in cryptocurrencies. By requiring the disclosure of cryptocurrency assets, South Korea aims to foster a secure and ethical environment within its public sector. As the country takes proactive steps in regulating this emerging asset class, it sets a precedent for other nations grappling with similar challenges.

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