The FSC recently announced that it has decided to launch a new cryptocurrency division that will oversee South Korea's cryptocurrency market.
South Korea has been taking solid steps towards regulating cryptocurrencies and blockchain technologies so that they can be properly addressed. The government announced in April that they would be creating a set of unified regulations to help deal with digital currencies.
The FSC announced a reshuffle so that it will be able to implement these changes. The new division will be called the Financial Innovation Bureau (FIB) and will be required to address the challenges that are presented by new financial technologies like blockchain and cryptocurrencies. Though mainly focused on crypto, the FIB will also work on various financial technologies to ensure that proper policies are implemented for them. The FIB is meant to be a temporary body, with a lifespan of just two years.
In a statement, the South Korea-based FANTOM Foundation said
I think Korea can be an ideal incubator to test drive new virtual coins and their blockchain systems High-speed internet infrastructure is already here, unparalleled to any other country in the world. And the Korean people are very adoptive of technology. Now it is the government's role to establish a favourable environment for virtual coins and their blockchains.
Crypto Agencies Uneasy About FIB
This is just the latest move by the South Korean government to ensure that it approaches the cryptocurrency industry with the proper caution, though in a positive manner. Earlier this month, South Korea changed its designation of cryptocurrency exchanges from communication vendors to legal business entities.
Many crypto agencies in South Korea are a little uneasy about the creation of FIB as they are not sure what will happen to them now that a new regulatory body is set to govern them. Usually, a new regulatory body means a tightening of regulations and a crackdown on operators who breach any of the new regulations. Their fears were soothed over when it was announced that the FIB aims to follow the Financial Stability Board's recent report on cryptocurrencies which stated that they are ‘not a threat to global financial stability‘.
With the formation of FIB, it appears that South Korea are one of the few countries that fully recognize the benefits that cryptocurrencies and what blockchain can bring to the table. What the new cryptocurrency division will do with its new powers and responsibilities are still up in the air though.