South Korea’s FSC Endorses Nonprofit to Secure Crypto Assets after Exchange Closures

The Financial Services Commission (FSC) of South Korea announced
today (Wednesday) that it has approved the creation of a nonprofit organization
aimed at protecting virtual assets for consumers in the event that a
cryptocurrency exchange goes out of business.

FSC Establishes Asset Protection Foundation

The organization, provisionally named the Digital Asset
Protection Foundation, will be responsible for ensuring the safe return of
virtual assets from defunct exchanges to their rightful owners, according to
the FSC.

The commission stated that it has been making continuous efforts to
guarantee the security of user assets if a cryptocurrency exchange ceases
operations or is forced to shut down.

The FSC noted: “However, there exist concerns over the
protection of assets as the return process often takes an extended period of
time due to failures to contact the operators of (closed) exchanges or users
failing to claim their assets.”

JUST IN: South Korea’s FSC approves nonprofit to safeguard crypto assets after exchange closures. Digital Asset Protection Foundation aims to ensure safe return of assets from defunct exchanges. 10 out of 22 exchanges closed in the country. Launch expected next month.

— RWA Pulse – by RWA.io (@rwa_pulse) September 25, 2024

Meanwhile, South
Korea has postponed the implementation of taxes on cryptocurrency gains
until 2028, as reported by Finance Magnates.
The government originally intended to introduce a 20% tax on profits over 2.5
million won ($1,875) starting in January 2023.

This deadline was first moved to 2025 and is now delayed to
2028. The ruling People Power Party emphasizes the need for a comprehensive
regulatory framework before enforcing any taxation to ensure market stability
and security.

Ten Exchanges Close

Of the 22 cryptocurrency exchanges operating in the country,
10 have already closed, while 3 have temporarily halted operations. The FSC
pointed out the challenges in expecting defunct exchanges to allocate resources
to safeguard and return virtual assets to their customers.

In response to these issues, the Digital Asset eXchange
Association has been advocating for the establishment of an organization
dedicated to protecting users’ virtual assets from failed exchanges.

The FSC indicated that the foundation could be launched as
early as next month. It stated that the organization’s formation is intended to
provide users with enhanced security for their assets, while also reducing
potential market confusion following the closure of an exchange.

This article was written by Tareq Sikder at www.financemagnates.com.