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South Korea is planning to establish Crypto-Focused Bureau

Sep 09, 2021

Korea Financial Intelligence Unit (KFIU) will also set up a ‘Policy Management Planning Division’ as a part of the brand-new bureau launch.

The Financial Service Commission (FSC), a South Korean financial watchdog, announced on Thursday that it would set up an independent bureau that seeks to address all crypto-related matters in the South Korea.According to media-outlet ‘The Korea Times’, KFIU will have the legal power to handle the brand-new agency.

The announcement came one day after a top nominee to lead the FSC discarded the possibility to consider cryptocurrencies as financial assets such as fiat currencies. Instead, the newly-organized regulator will be named ‘Crypto-Asset Monitoring Bureau’ and its main goal is to track any suspicious crypto-related transactions and to decide whether to extend licenses for crypto operations in South Korea.

“The FSC’s decision for the creation of an independent bureau inside KFIU with increased personnel is aimed at checking and monitoring cryptocurrency-related financial activity and preventing potential money laundering,” an FSC official commented. Furthermore, the watchdog will have another bureau named “Policy Management Planning Division.”

Crypto Regulation in South Korea

Issues raised by the crypto-regulation became the most popular topic for South Korean government over last few months. According to the new directives, which are implied by the FSC and the Financial Intelligence Unit (FIU), those banks performing crypto-exchange must issue accounts using customers’ reals names in order of money laundering prevention.

Exchanges failing to comply with abovementioned measures would not be able to operate in the South Korea. In fact, the picture is still unclear for major domestic crypto exchanges, as Upbit recently became the first one of the four existing most prominent crypto exchanges operating in South Korea to register before the FIU. Doh Gyu-sang, the FSC Chairman, pointed out that the agency is expecting to see the registry of one or two more exchanges by the end of this month.

However, not only South Korea is planning to expand cryptocurrency regulatory authorities – Nigeria is following almost the same path.

Nigerian Securities and Exchange Commission (SEC) is setting up a new authority in order to study Crypto Investments Main purpose of the freshly-formed division is crypto investments aspects assessment in order to develop new regulation.

SEC, Nigerian financial market regulator, has set up a fintech division to study all crypto-related investments and products to assess the feasibility of establishing a regulatory framework. According to the Director of the SEC, Lamido Yuguda, the bureau wants to come up with proper ruling to protect customers’ interests in the best possible way. “We are looking at this market closely to see how we can bring out regulations that will help investors protect their investment in blockchain,” Yuguda told Reuters. However, he did not provide a deadline for domestic crypto-market regulation deployment. Also, SEC’s Director stated that the bureau would continue regulatory framework development process as soon as Nigerian banking system will allow cryptocurrencies.

In the same interview, Yuguda stated that the SEC had been in talks with the Central Bank of Nigeria (CBN) as they are preparing the launch of the forthcoming CBDC, e-Naira. Last month, the CBN drafted a series of guidelines addressing domestic banks about the Nigerian central bank digital currency project. The document is aimed to detail the design and the operational structure of the coin, which is reportedly intended to be legal tender in Nigeria. Reuters noted that the Nigerian financial watchdog looks forward to working with domestic fintech firms to prevent capital flight.

Cryptocurrencies in Nigeria

At the beginning of the calendar year, Nigerian Securities and Exchange Commission had a pretty strict position against cryptocurrencies suspending its plans to regulate the digital assets following the central bank’s circular in suspending bank accounts for crypto companies.

Nigeria is one of most crypto-penetrated countries in Africa. Data complied by Coin Dance, exposed that 60,215 Bitcoins were traded in Nigeria starting from 2016. In addition to that, SEC recognized cryptocurrencies in September 200 and is planning to create regulatory sandbox for digital currencies.

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