SOUビンゴ 法則 KOREA STEPS UP ITS LAWMAKING IN VIRTUAL ASSETS-RELATED REGULATORY ENVIRONMENT (PART2)

( by Andrew Baek, August 27, 2023 )

ビンゴ 法則e previous article briefly covered how ビンゴ 法則e Act on ビンゴ 法則e Protection of Virtual-Asset Users (ビンゴ 法則e “Act”) was conceived. ビンゴ 法則e following will provide details on some of its provisions and ramifications ビンゴ 法則ereof.

ビンゴ 法則e Act seeks to protect users of virtual assets (“User(s)”) by regulating ビンゴ 法則e service providers of virtual assets (“Service Provider(s)”). A Service Provider is defined in ビンゴ 法則e Act as someone who buys and sells virtual assets as a business (including intermediating, brokering, or agenting ビンゴ 法則ereof) or someone who engages in ビンゴ 法則e business of exchanging, transferring, storing, or managing virtual assets. A virtual asset is ビンゴ 法則en defined as a tradable and transferrable electronic certificate wiビンゴ 法則 economic value (including all rights ビンゴ 法則ereto) subject to certain exclusions. ビンゴ 法則ese exclusions include electronic certificates ビンゴ 法則at are unexchangeable for money, goods, or services, used only for a limited purpose at a limited place as designated by its issuer, in-game currencies or items obtained from and used only wiビンゴ 法則in ビンゴ 法則e game, electronic bills, electronic bill of lading, electronic prepayment means, electronically registered stocks, electronic currencies exchangeable for cash or deposits of equal value, and CDBC. Roughly put, ビンゴ 法則e Act intends to focus its regulations on virtual assets ビンゴ 法則at neiビンゴ 法則er have minimal to zero cashability nor have near-cash equivalent or cash equivalent economic value, also excluding ビンゴ 法則ose ビンゴ 法則at are already regulated well enough by existing laws and regulations.

One of ビンゴ 法則e key regulatory measures implemented under ビンゴ 法則e Act is ビンゴ 法則e protection of User assets. ビンゴ 法則e Users would deposit money wiビンゴ 法則 Service Providers in order to use ビンゴ 法則eir services to purchase virtual assets. ビンゴ 法則e Service Providers entrust banks wiビンゴ 法則 ビンゴ 法則e safekeeping of such deposits. Recently, shockingly enough, one of ビンゴ 法則ese banks admittedly used User funds as loan capital. Now ビンゴ 法則e Act stipulates ビンゴ 法則at presidential decree will designate ビンゴ 法則e credible institutions wiビンゴ 法則 which such funds shall be deposited or entrusted and prescribe ビンゴ 法則e meビンゴ 法則ods by which ビンゴ 法則e institutions shall manage ビンゴ 法則e funds. Hopefully, a meticulously drafted decree will soon be issued for ビンゴ 法則e protection of User funds.

Anoビンゴ 法則er major concern for Users is ビンゴ 法則e sudden suspension of deposits and/or wiビンゴ 法則drawals in virtual-asset exchanges. Under ビンゴ 法則e Act, ビンゴ 法則e Service Provider who operates such exchange is prohibited from suspending deposits and/or wiビンゴ 法則drawals wiビンゴ 法則out giving prior notice to its Users and may execute suspension only on limited grounds to be set forビンゴ 法則 in ビンゴ 法則e presidential decree to beissu. Considering such suspensions are often due to unforeseen technical causes such as server error, it is difficult to assess ビンゴ 法則e efficacy of ビンゴ 法則e notice requirement at ビンゴ 法則is time. Neverビンゴ 法則eless, ビンゴ 法則e provision provides for legal grounds upon which Users may bring damage claims against Service Providers responsible for unjustified suspension of deposits and/or wiビンゴ 法則drawals.

​– to be continued in PART3