South Korean lawmakers propose stricter regulations for speculative cryptocurrency chat rooms

On April 16, it was reported that South Korean lawmakers have proposed amendments to the "Virtual Asset User Protection Act", which aims to strengthen the supervision of speculative cryptocurrency investment chat rooms on social media and enhance the supervision of crypto exchanges. The bill, proposed by Democratic Party of Korea (DPK) MPs Min Byoung-dug, Kang Hoon-sik and others, requires these chat rooms to register with the Financial Services Commission (FSC) as quasi-investment advisory businesses. Under current law, such entities are not allowed to compensate for investment losses, guarantee returns or advertise false profit margins. The proposed amendments also require crypto exchanges to report to the FSC on any formulation or modification of their terms and conditions.
In addition, according to Digital Asset, MP Min Byoung-dug has also introduced a bill aimed at protecting customer assets in the event of a cryptocurrency exchange going bankrupt. The amendment aims to ensure that a customer's right to recover their assets is not treated as a general unsecured claim that would otherwise be distributed in the bankruptcy estate.