In a recent move by the South Korean government, it now requires government officials to declare Bitcoin and crypto holdings. The bill was passed and made part of the crypto regulations by the South Korean parliament.
The Kim Nam-Guk Prevention Law was passed after there was a scandal that involved different members of the South Korean National Assembly transferring huge amounts of crypto holdings.
The South Korean government is going ahead with new laws that make it necessary for lawmakers to disclose their cryptocurrency holdings including Bitcoin. It was passed unanimously by South Korea’s National Assembly.
Apart from lawmakers, the bill also makes it necessary for high-ranking public officials to disclose their crypto holdings. According to the reports of the local news agency, the lawmakers passed the legislation on 25th May during the plenary session.
What Does the Bill Entail?
Various amendments came along with the bill in the Public Service Ethics Act and the National Assembly Act. All 269 lawmakers of the National Assembly agreed to pass the bill and make it a part of the legislation.
Additionally, all 268 lawyers agreed on making amendments to the Public Service Ethics Act. The amendments to the National Assembly Act were passed on the 22nd of May and officially places the digital asset on the registered property list by lawmakers.
On the other hand, the Public Service Ethics Act amendments also mean that office bearers in the high government position along with the members of South Korea’s National Assembly must declare their crypto holdings.
Bill Passed after the Kim Nam-guk Scandal
The recent development came in after the Kim Nam-guk scandal where there were reports of a few members of the National Assembly moving huge amounts of cryptocurrencies.
Most notably, the former member of the main opposition in the county, Kim Nam-guk, was discovered to have around $4.5 million Wemix tokens. There was an outrage in the National Assembly, leading to the lawmaker resigning.
It also led to growing concerns about the usage of cryptocurrencies for insider information, conflict of interest, and potential money laundering.
As a result, the South Korean government decided to quickly respond to the issue by taking a legal initiative which is popularly known as the Kim Nam-guk Prevention Law.
The primary purpose of this law is that all the lawmakers and senior officials that have crypto holdings worth more than $760 should declare it in their wealth, similar to other assets, like cash, gold, bonds, stocks, etc.
Earlier, it was decided that the legislation would be coming into effect by the end of this year. However, there were members of the parliament such as Yun Jae-ok that asked the government to push the enforcement to July.
Therefore, the new legislation would take effect in July rather than December 2023. Most importantly, South Korea has been planning on implementing the “Travel Rule” set by the Financial Action Task Force (FATF).
Emphasis on Regulating the Crypto Industry Globally
The crypto market is always known for its high volatility and uncertainty. But it is time that many governments around the world decided to introduce regulations for the crypto industry.
The U.S. Securities and Exchange Commission has increased its clampdown on various crypto exchanges and firms. In Canada, a renowned crypto exchange, Binance, decided to quit the country and close its operations due to the growing regulatory pressure.
On the other hand, many countries, such as Japan, Germany, Switzerland, etc., are now working on regulating the crypto industry. They are providing a more clear set of instructions to the crypto exchanges regarding compliance.