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(Photo= Yonhap news) |
[Alpha Biz= Reporter Kim Sangjin] The Financial Supervisory Service (FSS) of South Korea is set to conduct its first inspection of domestic virtual asset businesses following the enactment of the Virtual Asset User Protection Act in July.
According to the "Second Half of 2024 Inspection Plan for Virtual Asset Businesses" announced on the 2nd, the FSS will check compliance with legal obligations among major domestic virtual asset operators. The inspection will cover two major cryptocurrency exchanges—Upbit, Bithumb, Coinone, Gopax, and Korbit—and six wallet and custodial service providers.
The FSS plans to select inspection targets based on the impact of business operations on the market and the level of user protection provided by the businesses. The selection will also consider specific issues identified during the supervisory process, including two exchanges operating in the Korean won market.
Additionally, the FSS will identify businesses with poor financial conditions or weak internal controls over virtual asset custody, which could lead to user harm. On-site inspections will be conducted for three cryptocurrency exchanges and one wallet and custodial service provider. The FSS will also carry out prompt and stringent thematic inspections of businesses suspected of major violations based on tips and complaints.
The key areas of focus for the inspections will include:
1. Compliance with the Virtual Asset Act and user protection systems.
2. Proactive checks on businesses with vulnerabilities in user protection.
3. Review of regulatory compliance related to unfair trading practices.
Detailed inspection items will involve reviewing compliance with regulations on virtual asset custody and management. This includes evaluating the appropriateness of contracts with management institutions such as banks, and verifying the rational calculation and payment of deposit usage fees.
AlphaBIZ Kim SangJin(letyou@alphabiz.co.kr)
