According to a report published by local media on February 15, Korean financial regulators are investigating the market for cryptocurrency staking services. This is due to concerns within the crypto community about the potential effects of the recent court settlement between the United States Securities and Exchange Commission (SEC) and Kraken. South Korean officials are following the lead of their American counterparts and intend to scrutinize the nation’s crypto-staking operators.
The report doesn’t disclose the examination’s techniques and timeline, but it suggests that the investigation could impact some legislative decisions. Korean law did not define crypto staking at the time, unlike digital assets, where the country’s regulators have taken increasingly frequent enforcement actions.
Exchanges claim that they provide technical support to their customers and collect a 10% validator charge in place of staking services. Some even assert that they had already fulfilled regulatory requirements relating to staking when they reported as virtual asset operators during the previous Special Financial Transactions Act.
The settlement between the SEC and Kraken on February 9 has sparked a global conversation on crypto staking. Kraken consented to stop its staking program and pay a $30 million fine. This action has drawn intense criticism from the American crypto community.
The Financial Services Commission of South Korea published guidelines on February 6 outlining the categories of digital assets that will be regarded as securities in that nation and subject to its regulation. The law defines securities as financial investments in which investors are not obligated to make further payments after their first investment.
The new guidelines are part of the nation’s preparations for the legalization, issuance, and distribution of security tokens. The FSC ruled that brokers, such as cryptocurrency exchanges and token issuers, will determine which cryptocurrencies will be categorized as securities based on the rules. The agency also stated that each situation would be evaluated individually.
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