Cryptocurrency crime offenders may now face a life imprisonment sentence after the South Korean government updated its Virtual Asset User Protection Act. The Financial Services Commission (FSC), which is a reputable finance regulator in South Korea, made the disclosure on Wednesday through an official blog post.
According to the regulator, the latest update surfaced as part of its efforts towards combating the use of cryptocurrency for illegal acts in the country. More so, the development is aimed at protecting crypto investors in South Korea against market crimes. Furthermore, indications from the update highlighted how the regulator intends to promote transparency while championing the rights of cryptocurrency investors.
As per the FSC, criminals who net more than $3.8 million from illicit crypto operations will now face life imprisonment. Likewise, the latest regulation places a ban on the use of “undisclosed important information” relating to cryptocurrency, market manipulation, and criminal trading. Also, the law comes with prominent criminal punishments and penalties for the infringement of its stipulations.
Now, following the adoption of the new law, the FSC authority has the power to oversee and inspect cryptocurrency businesses in South Korea. Also, the regulator has the backing to investigate and penalize the firms if they engage in unfair trading activities. Similarly, the Virtual Asset Users Protection Act provides the regulator with enforcement powers to ensure that virtual assets companies operating in the country comply with existing regulations.
Accordingly, the Virtual Asset User Protection Act will come into play by July 19, 2024, marking over a year after the bill became enacted. Recall that on July 18, 2023, the lawmakers in South Korea enacted the Virtual Asset User Protection Act. Initially, the lawmakers passed the bill in June 2023 in response to the Terraform Labs meltdown.
How the Growing Adoption of Crypto in South Korea Fueled the Enactment of the Virtual Asset User Protection Act.
South Korea in recent times has matured into one of the top hubs for crypto investment. Recently, various innovations have emanated in the virtual assets sector of the country. In May 2023, ChainLink partnered with DeSpread to enhance the adoption of web3 and virtual in South Korea. According to Binbits, the partners work on the publication of educational materials to orient people about web3 and virtual assets.
Also, another Binbits report in April 2023 revealed that Binance invested in GOMBLE, a blockchain casual game developer in South Korea. The report established that the cryptocurrency exchange made the financial commitment in an effort to onboard more users into the Web3 and virtual assets landscape. However, it became imperative for regulators to introduce new laws in an effort to protect investors in the virtual asset sphere. This focus led to the introduction of the Virtual Asset User Protection Act.