Increased restrictive anti-money laundering (AML) conformity rules could be arriving for South Korean crypto exchanges after a lawmaker submitted a private member’s bill in the National Assembly.
The National Assembly, South Korea’s parliament, will likely discuss and vote on the bill, moved by MP Hong Seong-guk of the ruling Democratic Party.
Hong has submitted reformations to the existing financial bill, ordering businesses registered as virtual asset service providers (VASPs) to stand by the same AML agreement protocols as presently applied to established financial service providers.
The plan would see the top financial regulator, the Financial Services Commission, require VASPs to submit data on transactions and observe them for speculated AML violations – flagging and listing suspicious-looking crypto transactions.
Hong petitioned that hacking and money laundering is widespread in the domestic crypto sector, where he declared “over USD 167m in transactions” over the past five years, per the Daejon Ilbo.
Hong also said that there were “loopholes” and “blind spots” in both current and new legislation that will become active in March next year – which also holds AML compliance-related provisions for crypto exchanges.
The new bill does not yet have the backing of any significant political party. Still, it could well build drive over August as it indicates the state in the National Assembly. Many MPs have left to criticize the crypto sector of late, declaring that it has been permitted to grow unchecked and tax-free.
A separate private member’s bill revealed last month by a different Democratic Party MP about crypto tax preempted the government’s own – very comparable bill – by a matter of days.