South Korea is set to undertake a thorough review of more than 600 cryptocurrencies listed on local exchanges next month as part of new regulatory measures.
According to sources familiar with the matter cited by Korean news outlet Dnews, the country’s financial authorities will kick off the re-evaluation of cryptocurrency listings on domestic trading platforms in July. This move comes in response to the implementation of the Virtual Asset User Protection Act.
The regulatory practices for crypto listings are currently being finalized by Korean financial regulators and are expected to come into effect on July 19 under the new law. Nearly 35 registered crypto exchanges, including major players like Upbit, Bithumb, Coinone, Korbit, and Gopax, will be responsible for conducting initial reviews to decide whether to keep or remove each token from their platforms.
Under the updated regulatory framework, crypto exchanges will need to establish a review committee to assess a range of factors, including the credibility of the issuing entity, measures to protect users, technology and security standards, and adherence to regulatory guidelines.
Additional criteria for the evaluation process will involve assessing the issuer’s reputation and capabilities, past business performance, transparency in operations, total supply and circulation of tokens, market capitalization, and potential conflicts of interest between the exchange and token holders.
The report also highlights that tokens issued by decentralized autonomous organizations (DAOs) might not meet standard requirements, while tokens with a history of trading for over two years in regulated markets like the U.S., U.K., France, Germany, Japan, Hong Kong, Singapore, India, and Australia will undergo a less rigorous review process. Furthermore, crypto exchanges will be prohibited from accepting payments in exchange for listing tokens.
Future reviews will take place on a quarterly basis, with tokens flagged as “problematic” being labeled as cautionary and potentially removed from exchanges. Crypto exchanges will have a six-month grace period to decide whether to continue supporting existing crypto listings, with subsequent maintenance reviews scheduled every three months.
In other news, South Korea’s Ministry of Justice has established a task force to combat crypto-related crimes.