Blockchain-based cross-border money transfer services have been strictly regulated in Korea, capping US$3,000 per transaction in transferring or US$30,000 per year under the Korean Foreign Money Transfer Act.
To appeal to the Korean government for relaxing the tough regulation, Moin, Korean blockchain-based money transfer service provider , has applied for a temporary exemption of the service from the Foreign Money Transfer Act in what’s called as a ‘regulatory sandbox’ policy to test whether it is worth doing it or not.
The regulatory sandbox policy is to temporarily exempt a certain new, disruptive technology or service from current regulation of the law to see whether it is worth being pursued in favor of technology innovations, public interests, public health and welfare, an protection of personal privacy.
Once approved to be put in the regulatory sandbox policy, the new disruptive technology or services will be allowed to be served or implemented in the service in a certain grace period to decide whether to ease down the regulation. If it turns out to be of public interests, the regulation will be relaxed to promote the service or technology.
When it comes to the cross-border foreign money transfer service, the ceiling of the money transfer will go higher, for example, if the service prove to be not at odds against public interests, enabling blockchain-based cross-border foreign money transfer service provider like Moin to compete with wholesale and retail banks in Korea on an equal footing in the service market.
The Foreign Money Transfer Act allows all banks to freely transfer up to US$ 50,000 worth of foreign money with no government permission, privileging them to outbid blockchain-based service providers in the competition.
Reviewing and deciding whether the cross-border foreign money transfer service is subject to the “regulatory sandbox’ policy is the evaluation committee of new technology ad service and the committee of the regulatory exemption policy review The evaluation committee of new technology and service is chaired by the minister of trade, industry, and energy, while the other committee is led by the minister of Science and ICT