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The Financial Services Commission (FSC) wants graver punishments for those who engage in unfair practices in South Korea’s crypto markets. The country’s top financial regulator wants the National Assembly to bring criminal liability to price manipulations, insider trading, and other unfair behavior.
The FSC made its recommendations in a report submitted to the South Korean Parliament on Nov. 23, according to Coindesk. The report will be used to draft crypto legislation that will go through the Parliament.
The regulator was ordered by the National Assembly to come up with a draft bill on crypto in a month’s time. However, the draft won’t likely make it in time for this year’s last parliamentary meeting scheduled on December 9.
The FSC recommended stricter punishments such as a minimum of one-year imprisonment and fines between three to five times of the gains obtained unfairly. At the moment, there is a minimum punishment of five years in prison for gains over 5 billion Korean won ($4.2 million).
The regulator also recommended taxes on some types of non-fungible tokens. The FCS seems to be contradicting its earlier statements that NFTs won’t be regulated.
“Digital assets that are unique, rather than interchangeable, and that are in practice used as collectibles rather than as payment or investment instruments, can be referred to as non-fungible tokens (NFT) or crypto-collectibles,” the updated guidelines from the FATF released earlier this month stated. “Such assets, depending on their characteristics, are generally not considered to be VAs under the FATF definition.”
Meanwhile, Seoul will be imposing a 20 percent tax on crypto gains over KRW 2.5 million ($2,100) starting 2022. While both the ruling and opposition parties are calling for an extension to the deadline to 2023, the proposal for an extension was rejected.
“Any further delay in the already postponed enforcement will lead to the loss of public trust in government policy and undermine stability in the legal system,” South Korean Finance Minister and Deputy Prime Minister Hong Nam-ki said, according to BanklessTimes.
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