Push to establish a virtual asset market surveillance authority… integrating the system for monitoring suspicious trades

A legislative revision is being pursued to establish an independent body dedicated to monitoring the virtual asset (cryptocurrency) market.

According to the National Assembly on the 31st, the Political Affairs Committee referred an amendment to the Act on the Protection of Virtual Asset Users, among other matters, introduced by Rep. Kim Nam-geun as the lead sponsor, to the Legislation Review Subcommittee.

The amendment calls for integrating the current surveillance system, which is operated on an individual-operator basis, and establishing a “Virtual Asset Market Surveillance Authority.” The core aim is to unify suspicious-trading monitoring and market oversight functions under an independent body.

The authority will be established as a corporation and will consist of no more than nine executives, including one head. The board will be required to have a majority of outside directors, and standards on executive qualifications, conflict-of-interest prevention, and confidentiality obligations will follow those set out in the Act on Corporate Governance of Financial Companies.

It also makes the establishment of an audit committee and an executive candidate nomination committee mandatory.

Virtual asset exchanges will be required to join the authority, and a structure will be introduced under which they share membership dues and costs to carry out surveillance work.

The authority will have the power to monitor and review suspicious trades, as well as to inspect member firms. It will conduct cross-market linked monitoring and implement user-protection measures, and it will also be able to impose disciplinary actions on member firms and their officers and employees for violations of rules.