The government in South Korea has been taking a few steps to protect cryptocurrency investors from implosions similar to the Terra ecosystem- by passing a new crypto bill.
On the 30th of June, the National Assembly passed out the Virtual Asset User Protection legislation. This bill, for those unaware, is designed to regulate unfair trade practices and protect crypto investors, according to a report by the local news agency SBS Biz. The legislation would be integrating 19 crypto-related bills, which would then provide a unified bill that would define digital assets, whilst imposing penalties for illicit trading activities like the usage of undisclosed information, market manipulation, and other forms of unfair trading practices in the crypto sphere.
South Korea Has Brought In Crypto Bill That Would Deal With Unfair Trading
According to the local media, the main point of this Virtual Asset User Protection Act in a country like South Korea is to apply the Capital Market Act first to the virtual assets with a securities nature.
The legislation has also aimed at establishing a basis for imposing the penalties, as well as the liabilities for damages that were caused by unfair crypto trading. To protect the investors, the virtual asset service providers in the country are now reportedly required to take some form of responsibility for the users’ deposits, as well as provide insurance. Such measures are quite necessary to ensure user protection against hacks, computer failure, and other risks.
According to the news agency, any violation of the new rules is subject to fixed-term imprisonment of not less than a single year or major fines. For example, the Financial Services Commission in South Korea can readily impose a penalty that is equivalent to twice the amount for profits that have been gained through unfair trade.