South Korean Regulator Explains Crypto Listing Review Role

Amidst growing concerns over widespread delistings on South Korean crypto exchanges, the Financial Supervisory Service (FSS) has clarified its responsibilities. The recently enacted Virtual Asset User Protection Act enforces stricter token reviews, but the FSS highlights that it sets listing standards rather than directly ordering delistings.

Investor Concerns Over Potential Delistings

Rumors of up to 600 altcoins being delisted have unsettled South Korean crypto investors. These fears arose from reports suggesting the FSS had instructed major exchanges like Upbit, Bithumb, and Gopax to reassess their listed tokens.

However, the FSS clarified it does not directly influence delisting decisions. Instead, its role is to establish rigorous listing guidelines and collaborate with exchanges to create best practices for token reviews. The ultimate authority for listing and delisting decisions lies with the individual exchanges and the Digital Asset eXchange Alliance (DAXA).

Focus on Stricter Compliance, Not Mass Delistings

The Virtual Asset User Protection Act represents a move towards stricter regulations in the South Korean crypto market. Exchanges must now conduct biannual evaluations of their listed tokens, examining factors like the reliability of the issuing entity, user protection measures, and compliance with security standards. This increased scrutiny is intended to create a more secure and responsible crypto ecosystem.

Expanded Crypto Oversight by the FSS

The FSS’s dedication to the evolving crypto environment is evident from reports of a new division dedicated to crypto regulation. This division will focus on policy development, regulatory compliance, and shaping the future framework for crypto in South Korea.

A Clear Path Forward

The FSS’s clarification provides much-needed guidance for investors and crypto exchanges. While stricter compliance measures are forthcoming, the primary aim is to cultivate a healthy and secure digital asset market in South Korea.