In an unprecedented ripple effect from South Korea’s “Coin Gate” scandal, the financial regulatory staff now find themselves forced to disclose cryptocurrency holdings for regulatory scrutiny. Notable figures, including lawmakers, have been accused of insider trading, with suggestions of one MP capitalizing on advanced knowledge of crypto regulations while actively participating in a related parliamentary subcommittee. This now infamous “Coin Gate” incident seems to have triggered a culture of full disclosure among public officials and regulators in the nation.
The call for transparency has culminated in the Financial Services Commission (FSC), South Korea‘s primary financial watchdog, revising its employee Code of Conduct. Under the new guidelines, those handling “virtual assets” are prohibited from leveraging “undisclosed information” acquired at work for personal investments in cryptocurrencies. Furthermore, every staff member owning digital tokens must report it to the commission. Both currently serving officers dealing with virtual assets and individuals who’ve been involved in the last half year come under this restriction.
The FSC, known for regulating the country’s crypto industry and conducting surprise audits on domestic crypto exchanges, has introduced a new disclosure form called ‘Report on the Possession of Virtual Assets.’ This remarkable move demands staff to divulge information about their crypto holdings, acquisition dates, and quantities of tokens owned. However, these amendments to the Conduct Code require legislative validation, culminating in an accelerated legal process that the FSC aims to conclude by the second half of this year.
Such bold crypto regulation moves aren’t confined exclusively to South Korea. Other countries, notably Ukraine, have already enacted legislation necessitating public officials to declare cryptos among their asset portfolios. Though initially met with public outrage over the substantial crypto possessions of several MPs, the practice has seemingly championed transparency.
The question that now rises is whether other nations will follow suit. South Korea and Japan have always been perceived as pioneers of crypto regulation. The recent developments might suggest other jurisdictions echoing their transparency efforts. The debate seems to drift between ensuring comprehensive regulatory control and maintaining investor privacy. A balanced application of regulations, one that doesn’t stifle the crypto market’s essence while tackling insider trading and other illicit practices, might be the way forward.
Source: Cryptonews
