The Financial Intelligence Unit (FIU) under the Financial Services Commission (FSC) has disclosed a plan to directly regulate cryptocurrency exchanges and bring them into the regulatory system. Currently, the FIU indirectly controls cryptocurrency exchanges through administrative guidance to banks.
An FIU official said on Aug. 6 that the government will enhance the transparency of cryptocurrency transactions by introducing a “cryptocurrency exchange licensing system” recommended by the Financial Action Task Force (FATF).
Lee Tae-hoon, head of administration and planning at the FIU, said, “If an amendment to the Act on Reporting and Use of Certain Financial Transaction Information, which reflects the FATF’s international standards for cryptocurrencies, passes the National Assembly, it will be possible to prevent money laundering through cryptocurrencies.”
Lee was speaking at a public hearing on the enactment of a law to improve transparency in virtual asset trading held at the National Assembly Member’s Office building.
“If the amendment is approved by lawmakers, we can raise the effectiveness of regulations by shifting from the current indirect regulation through commercial banks to direct regulation,” Lee said.
In this regard, crypto exchanges and legal circles pointed out that the regulations on banks’ issuance of real-name accounts to cryptocurrency exchanges need to be specified first to ensure that cryptocurrency exchanges have the same level of real-name authentication and anti-money laundering systems as that of traditional financial companies.