The Financial Services Commission (FSC) of South Korea plans to ban citizens from using credit cards to buy digital assets on foreign cryptocurrency exchanges. The relevant amendments will be made to the local credit finance act.
South Korea’s top financial regulator made a proposal to revise the credit finance act. The FSC suggests banning local citizens from using credit facilities and untraceable accounts to buy cryptocurrencies.
The goal of the FSC initiative is to reduce the number of illegal transactions and money laundering risks and prevent the outflow of domestic funds. According to the proposed amendments, digital assets will be labeled as “prohibited for payment,” and South Korean citizens won’t be able to legally use credit card funds to purchase them.
The local media outlet reports that the current version of the credit finance act allows South Korean citizens to transact on local crypto exchanges only through debit accounts that identify the owner. However, this rule doesn’t currently apply to interactions with foreign crypto platforms.
The amendments to the bill are planned to be officially introduced in the first half of this year. Now the legislative initiative is at the stage of public discussion, which will last until February 13.
The legal framework for crypto market regulation in South Korea should come into force in 2024. The preparation of the relevant bill has been underway for about a year and a half.
