China, Japan, and several other Asian countries are keen on regulating cryptocurrencies | Source: Shutterstock
Why Asian regulators remain cautious about cryptocurrencies
REGULATORS in Asian countries seem to be cracking the whip on cryptocurrencies in a bid to avoid miscreants from using anonymous digital money to make illegal transactions.
South Korea began operating a real-name trading system for cryptocurrencies on Tuesday to stop virtual coins from being used for money laundering and other illegal activities.
The news follows an announcement from the Philippines’ Securities and Exchange Commission on Monday that it is creating rules to regulate cryptocurrency transactions to protect investors and reduce the risk of fraud.
Both announcements show that more countries in Asia are thinking on the lines of China and Japan, and looking for ways to regulate and secure digital currency payments.
South Korea’s payment system is part of its government’s new measures to curb speculative investment into virtual coins amid fears a cryptocurrency bubble could implode, report The Strait Times.
The system requires cryptocurrency exchanges to share users’ transaction data with banks which could potentially allow the government to impose taxes.
New regulations in the Philippines will cover issuance and registration of cryptocurrencies and come into effect later this year, Emilio Aquino, SEC commissioner in charge of enforcement and investor protection told Reuters.
“We need to act because initial coin offerings (ICOs) are sprouting especially in 2017. We want to come up with our own set of regulations,” Aquino told a news conference. “You have to be extra careful how investors in this new space are protected.”
While the rest of the world is still evaluating cryptocurrencies, the threat in Asia is immediate since citizens in the region seem to have embraced the idea behind it. Trading volumes in Japan, China, and South Korea continue to soar despite the regulatory measures and volatile prices, according to local news stories.
The potential danger for companies dealing in cryptocurrencies became evident last week when hackers stole $530 million worth of digital money from Tokyo-based cryptocurrency exchange Coincheck Inc.
Nevertheless, the general consensus around cryptocurrencies remains positive.
Heidi Vella is a freelance energy and technology journalist based in London. Her interests include smart cities, clean energy, emerging markets and technology innovation. Prior to working freelance, Heidi spent four years’ covering all things technology and energy-related for London-based Progressive Digital Media.