South Korean Exchanges Pledge to Protect Altcoin Trading Amid New Regulations, Here’s All
South Korea’s cryptocurrency market is set for major changes with the introduction of new investor protection rules. The country, known for its vibrant altcoin trading scene, is set to implement the Virtual Asset User Protection law on July 19. The impending regulation has sparked widespread discussion in the crypto community about its potential impact on digital asset trading.
South Korea has a significant presence in the global crypto market, with the Korean won recently overtaking the US dollar as the most-used currency in crypto trading. Around 10% of the country’s population has exposure to digital assets, with the bulk of trading in smaller coins rather than market leader Bitcoin.
Stock Exchanges’ Reaction to New Regulations
In response to the impending regulations, South Korean cryptocurrency exchanges are taking proactive steps. The Digital Asset Exchange Alliance, an industry trade body, announced plans to review 1,333 altcoins over the next six months. The review aims to ensure compliance with the new Virtual Asset User Protection law and allay concerns that the regulations could quickly encourage speculative trading in smaller digital assets.
The alliance noted that due to the extended review period, “mass delistings are unlikely” immediately. Additionally, all new token listings will be assessed under the new law once it comes into effect. This measured approach suggests a gradual implementation of regulations rather than a sudden market shift.
The new legislation was prompted in part by the 2022 crash of Luna and terrausd tokens created by South Korean entrepreneur Do Kwon, which resulted in losses of over $40 billion. While the law aims to protect investors, it could also increase operational costs for exchanges like upbit, one of the world’s top crypto trading platforms. This development illustrates the ongoing balance between investor protection and maintaining South Korea’s dynamic crypto trading culture, particularly in altcoins.
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Legal Developments in the Korean Crypto Space
In a significant legal development, the Seoul High Court has overturned a previous ruling in a dispute involving major blockchain platform fantom Foundation. The court dismissed all claims filed by SikSin and Ahn against Fantom and reversed an earlier ruling that awarded the plaintiffs over 198 million FTM tokens.
The case centered on agreements to implement Fantom’s technology in South Korea’s food industry. The Supreme Court ruled that SikSin and Ahn failed to fulfill their contractual obligations, including integrating Fantom’s technology and producing a technical document applicable to the Lachesis Protocol. The court also noted evidence of plagiarism in the plaintiffs’ work.
Fantom CEO Michael Kong welcomed the decision, while the company’s legal team also noted the complexity of the case. The decision is expected to impact how blockchain-related disputes are handled in South Korea’s legal system, particularly those involving cross-industry applications and intellectual property issues. It sets a precedent for future cases at the rapidly evolving intersection of blockchain technology and traditional industries.
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