South Korea has taken big steps in legitimising crypto exchanges and blockchain making a better environment for the users through more regulation.
South Korea’s relationship with the cryptocurrency industry has ebbed and flowed over the years. There has been a blanket ban on ICOs, set in September 2017, as well as strong rumours in January — that were eventually dismissed — that cryptocurrencies in their entirety would be banned.
However, things have warmed up in the Asian country with talk emerging that South Korea is now looking to lead the way in the fourth industrial revolution. South Korea’s government seems to have realized how much potential there is in the blockchain and cryptocurrency space — catching up with its citizens, who contribute a large portion of the global cryptocurrency trading market; it was reported that South Korea processed over 14 percent of global Bitcoin trades in July of last year.
The change in attitude from the government, however, has come with heavy regulations and rules in the use of cryptocurrencies.
Some notably harsh regulations that they have put upon the crypto space in the past include:
Banning anonymous trading
Forbidding minors and government officials from trading
However, they have also acted positively by:
Recently lifting the blanket ban on ICOs
Legalizing Bitcoin as a remittance method
Latest developments — classification of crypto exchanges
The latest move from South Korea has seen them essentially reclassify cryptocurrency exchanges as legal entities. The new draft, which adds a lot of legitimacy to the blockchain space in the country, now classifies exchanges as “crypto asset exchange and brokerage.”
This is an important redefinition because it “recognizes crypto exchanges as regulated financial institutions,” as opposed to their previous classification as “communication vendors.”
Of course, looking at cryptocurrency exchanges as legal entities sounds extremely positive for the space in the country, as they are now viewed by the government as legitimate legal entities that are