“Despite admitting to helping local prosecutors classify Terra-LUNA tokens as securities,” South Korea’s Financial Supervisory Service (FSS) Governor Lee Bok-Hyun disagrees with the notion that the cryptocurrencies cannot be viewed as financial investment products or securities, according to local media.
In a press conference on Thursday, Lee said, “As a person in the field of law and financial services, the judgment that in some circumstances, [crypto] they can be considered titles “.
Lee said prosecutors also have the authority to determine whether a subject is safe, clarifying that this authority does not belong only to the financial authorities.
On Wednesday, South Korean prosecutors issued a warrant for Do Kwon, a co-founder of Terra, and five other affiliates investigating the collapse of Terra-LUNA on suspicion of breaking capital markets law.
This happened because the now defunct stablecoin and Terra’s sister cryptocurrency were seen as stocks by prosecutors.
Yoon Suk-yeol, the president of South Korea, said earlier this year that his government would regulate cryptocurrency in two ways: for tokens that resemble securities and for non-securities.
While utility tokens and non-security tokens will be governed by a new cryptocurrency law, the government intends to regulate security-like tokens under the existing capital markets law.
While regulating the sector, South Korea enters the Web3 market.
According to a recent article by Be[In]Crypto, South Korea’s ruling party lawmakers are developing a law to promote the metaverse industry.
The first set of metaverse ethics was then published by the South Korean Ministry of Information and Communication Technology (ICT) Science.
Authorities also announced last month that cryptocurrency airdrops will be subject to a donation tax with a tax rate of 10% to 50%.
With the entry of new participants in the cryptocurrency and metaverse sectors, South Korea is experiencing legislative changes.
Yoon Suk-yeol, the then president of South Korea, expressed his intention to lift the country’s ban on initial coin offerings (ICOs) earlier this year, which led to the next wave of reforms.
The Bank of Korea also released a local document on the “European Union Crypto Asset Market Act (MiCA)” on August 29 calling for the legalization of ICOs in the nation.