- South Korea is preparing to implement a new crypto law.
- The crypto law was enacted in July 2023.
- The law seeks to curb crimes in the virtual assets industry.
South Korea is preparing to implement stringent crypto user protection laws that could see criminals get up to life imprisonment for a range of violations.
Enacted in July 2023, the new legislation is part of South Korea’s two-part digital assets regulation framework introduced in response to the 2022 crypto industry implosion involving Terraform Labs and its founder, Do Kwon.
Crypto Crimes to Attract Life Imprisonment in South Korea
In a press release dated February 7, South Korea’s Financial Services Commission (FSC) announced preparations for implementing the Virtual Asset User Protection Act on July 19 to “protect virtual asset users and establish order in the virtual asset market.”
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Notably, the legislation stipulates specific criminal punishment or fines for market manipulation, illegal trading, and the use of undisclosed important information regarding virtual assets.
“In the case of criminal punishment, a fixed-term imprisonment of more than one year or a fine equivalent to three to five times the amount of unjust enrichment is possible. Depending on the amount of illegal profits (more than 5 billion won), a person may be sentenced to up to life imprisonment,” the statement read.
The law gives the FSC authority “to impose a fine equivalent to twice the amount of unfair profits.” The fines may be imposed after the FSC notifies the Prosecutor General of the charges and receives notification of the investigation’s outcome.
Per the statement, the law also allows the FSC to collaborate with the Financial Supervisory Service in unfair trading practices investigations. In case of a violation, the FSC may suspend the crypto business, order correction, file a complaint, or notify the investigative agency.
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