After ICO and new bitcoin exchange regulation have been commented on during the past months by individual members of the South Korean regulator for the investment industry, the Financial Services Commission (FSC), earlier today they made official that all forms of Initial Coin Offerings (ICOs) will be prohibited.
The joint task force was held between the FSC, the Korea National Statistical Office and Korea National Police Agency (KPA) who will now be implementing and upholding new laws in the domestic digital asset and bitcoin market.
However tough to regulate, there will be no official ICO formation taking place for South Korean registered companies and will not be regulated under the FSC.
Second, the commission is keeping its recent halting and ban on margin trading for now. South Korean bitcoin exchange Coinone thought this halting would just be a temporary ban after getting sent a letter to stop all forms of credit lending for trading a couple weeks ago.
The FSC, however, says that this is an unauthorized allowance of credit under the Financial Business Act. They also expressed a great deal of concern in potentially encouraging and increasing consumer damage. Despite, the margin offered was quite small and in line with other securities industries.
Their concern is also to make sure that the exchanges operating are adhering to proper KYC and other AML regulations in place to prevent any money laundering or criminal activity.
It is also understood now that beginning next month, on-site inspections will be conducted for major bitcoin exchanges, to make sure they have systems in place to adequately uphold these requirements.