Lately, rumors have been circulating about the South Korean government banning cryptocurrency trading – about a month after it had presented regulations to continue the practice while ending anonymous transactions.
Those rumors have been taking a toll on the cryptocurrency community since South Korea is one of the largest markets when it comes to cryptocurrency trading.
The community can breathe a sigh of relief as those rumors have now been put to rest.
A government body from South Korea just confirmed that the country does not have any intention of banning cryptocurrency trading anytime soon, and will continue to allow “normal transactions” within its territory.
Cryptocurrency trading will be supported under regulations
According to local news sources, Choe Heung-sik, who is the governor of South Korea’s Financial Supervisory Service (FSS), made these remarks during a meeting about the future of cryptocurrencies in the country.
The meeting by FSS was held with representatives from cryptocurrency exchanges, and matters ranging from the current outlook of cryptocurrency transactions to the future of cryptocurrency trading were discussed at length.
Choe explained to the exchanges’ representatives that the government “will support (cryptocurrency trading) if normal transactions are made.”
By “normal transactions”, the regulatory body refers to transactions that are performed under its issued guidelines as of January 30, 2017, which ended the sense of anonymity with cryptocurrency trading, ordering all trading exchanges and banks that supported their cryptocurrency accounts to only operate with “real name” accounts while having detailed know your customer (KYC) measures in place.
Through these measures, the government aimed to keep the current structure of its economy stabilized, which is gradually being affected by the unprecedented rise of cryptocurrencies that previously had no regulations implemented upon them.
By passing regulations to use real name accounts, the government also ensured that any alleged anti-money laundering practices that were taking place through cryptocurrencies met their end.
While those regulations stay in place and do not seem to be going anywhere, this confirmation from the FSS about not banning cryptocurrencies is very good news for the global cryptocurrency community, as it hints towards a thriving future for the cryptocurrency industry in South Korea – even if comes with regulatory measures.
Banks might be encouraged by this news
Amidst the uncertainty of the future of cryptocurrencies in South Korea, banks in the country have been reluctant in facilitating transactions for cryptocurrency exchanges even by using the new real name trading system that was introduced by the government.
Since private banks are not liable to offer additional products that they do not feel comfortable with, most banks did not delve into the highly-regulated real name accounts for cryptocurrencies, which in turn resulted in issues for the local cryptocurrency traders.
According to reports from previous accounts, officials from these banks stated that the uncomfortableness comes from how cryptocurrency transactions get a bad rap, and the rumors about the new financial assets being banned do not help in improving that frame of mind.
However, Choe stated that the government is going to encourage banks to go through with such products.