Eun Sung Soo, a nominee for the chairman of Financial Services Commission of Korea warned not to make a hasty move to institutionalize cryptocurrency market, expressing concerns that it would risk evoking unnecessary side-effects.
In his answer to questionnaires put forward by parliamentary members of the National Assembly for the confirmation hearing, Mr. Eun said, “The adoption of cryptocurrencies by the de facto financial sectors would run risks of not only reigniting speculative investments crazes for properties and real estates, but also paving the way for money laundering.”
So, he stressed that the government would need to take a cautionary step in introducing cryptocurrencies in the de facto financial system, adding that the government must reach an international consensus to implement a legal framework for preventing cryptocurrencies from being misused for money laundering before the use of the digital money are legalized.
Touching on the pending issues of reporting systems for licenses of cryptocurrency exchanges , he pointed out that amendments on the Act on Reporting and Use of Financial Transaction Information must be passed before the reporting system are introduced.
Added he, “Today, cryptocurrency exchanges are established and being operated in the self-regulating way in some countries, but there are movements to strengthen government regulations across the world to protect investors. The reporting system for the opening of cryptocurrency exchanges is one of the regulations in force.”
“This helps explain why the amendments on the Act on Reporting and Use of Financial Transaction Information are in dire need, which will legalize the reporting system on the opening of cryptocurrency exchanges and prevention measures of cryptocurrency-based money laundering,” he stressed.
His remarks are in stark contrast with Choi Jong GU, current chairman of the commission, who are antagonistic to cryptocurrencies. His antagonism against the cryptocurreny is well reflected in the financial services commission’s year-long dismissal of the digital currency, showing no movements to curb either open cryptocurrency market.
On the other hands, FATF, or Financial Action Task Force, an inter-governmental body for anti-money laundering has already made a decision to manage and regulate cryptocurrency markets.
To keep up with the FATF’s embraces of cryptocurrency market, 4 amendment bills on the Act on the Reporting and Use of Financial Transaction Information remain pending at the National Assembly of Korea, including the introduction of the reporting system for the opening of cryptocurrency exchanges.
The amendments bills not only call for cryptocurrency exchanges to satisfy as stringent obligations as financial institutions must meet, but also require them to report crucial information on cryptocurrency transactions to FIU, or Financial Intelligence Units of Korea.
Nominee Eun’s pro-cryptocurrency remarks also reflect the FATF’s decision to regulate cryptocurrency markets, but he still remains in a measured attitude on the legalization of cryptocurrency markets