According to reports, South Korea’s new administration will complete the legal framework for the local digital asset ecosystem next year and implement it in 2024. The bill aims to integrate cryptocurrencies such as bitcoin into the country’s institutional system.
Furthermore, the authorities have given their blessing to the Bank of Korea’s plans to start a CBDC in 2023.
Yoon Seok-youl’s government addressed the cryptocurrency industry within two months after his victory in South Korea’s presidential elections. According to local reports, the government will pass the Digital Assets Basic Act in 2023, making crypto wholly regulated.
The proposal should integrate bitcoin and other cryptocurrencies into the country’s institutional framework, providing domestic investors with more protection when dealing with the asset class.
Before formally adopting the legislation, Korean officials promised to collaborate with the Bank of International Settlements (BIS), the Financial Stability Board (FSB), and American and European watchdogs before formally adopting the legislation.
The bill will also help Korean financial institutions that want to offer cryptocurrency services. Locals can currently open cryptocurrency accounts with the country’s top authorized exchanges – Upbit, Gopax, Bithumb, and Korbit.
A government official stated, “we will strengthen the link between digital asset trading accounts and banks by expanding financial institutions that provide real-time verification services for virtual asset transactions.”
The newly-elected government also mentioned Central Bank Digital Currency (CBDCs), as the administration will approve the central bank’s plan to issue a digital won next year. Furthermore, the Bank of Korea announced in January 2022 that the first phase of its CBDC testing program had been completed and that the second phase was already underway.
Following that, the government intends to give instructions on using non-fungible tokens and initial coin offerings (ICOs).
