FSC introduces new reporting rules for crypto companies in South Korea
FSC introduces new reporting rules for crypto companies in South Korea
In an effort to control the crypto industry, South Korea's Financial Services Commission (FSC) has notified crypto companies to provide financial reports detailing crypto transactions. This innovation will take effect at the beginning of 2024.
According to the new rules, issuers of crypto tokens will have to fully disclose the number and main characteristics of new crypto assets. They will also be required to report their expected profits from the launch of the tokens and provide their business model and accounting policies for the sale of cryptocurrencies.
Also from January 2024, companies using cryptoassets for investment will be required to report data on token classification, market value, and book value, according to Yahoo! Finance.
Based on the new rules, companies will consider cryptocurrency sales as profit only after they have fulfilled all obligations to investors, including payment of rewards and distribution of privileges.
The draft of the new FSC rules was already approved by the Korea Accounting Standards Board on July 7. South Korean lawmakers are confident that the new regulations will protect the interests of investors and increase the transparency of the crypto market while further supporting the local crypto industry.
South Korean crypto investors make up a significant portion of the global market, and the Korean won has become the third most traded fiat currency in bitcoin transactions, behind the US dollar and Japanese yen.
Fraudulent transactions in the financial world continue to span the cryptosector, with the total value of illicit cryptoasset transactions exceeding $20 billion in 2022, up from $5 billion five years earlier. Therefore, it is particularly important to ensure transparency in cryptocurrency accounting, which is what South Korea is striving for.
We previously reported that a report for the G20 stated that cryptocurrency cannot be treated as a monetary asset.
