[Column] Why the Second Phase of the Virtual Asset Basic Act Legislation Is Urgent

Investor Panic as Coin Deposit Service Suspends Withdrawals
Insufficient Safeguards Despite Virtual Asset User Protection Act

"The scale of damage could be greater than during the Gopay incident."

This was a comment made by an industry insider after virtual asset deposit service providers recently blocked withdrawals one after another. On the 13th, Haru Invest announced it could not return customers' coins, followed by Delio the next day, plunging the domestic virtual asset market into panic. Although Haru Invest and Delio issued statements and held briefings, there was no information on when the coins would be returned.

These companies promoted high returns to attract deposits and formed funds. They operated through external entrusted management, promising to return principal and interest to customers if profits were made. Haru Invest claimed to guarantee high returns of about 12% annually.

In fact, a similar incident has already occurred domestically. Most investors who invested in Gopay, the deposit service of the virtual asset exchange Gopax, have yet to recover their investments. Last November, the U.S. virtual asset lending company Genesis Trading suspended its service, delaying principal and interest payments. The situation has since prolonged, with reported damages exceeding 56 billion KRW. The global exchange Binance acquired management rights of Gopax and agreed to provide liquidity. However, because financial authorities have not accepted the Virtual Asset Service Provider (VASP) change report, investors still cannot retrieve their coins. Coins locked in Gopay can only be repaid once the change report is accepted, leaving investors frustrated for seven months.

As such, investors using virtual asset deposit services are suffering continuous losses. However, there is no legal framework to protect them. Although the "Act on the Protection of Virtual Asset Users" has passed the National Assembly’s Political Affairs Committee, it still needs to pass the Legislation and Judiciary Committee and the plenary session. Moreover, the bill mainly focuses on "user asset protection," "regulation of unfair transactions," and "supervision and sanctions." It emphasizes user protection centered on exchanges, leaving regulatory oversight on asset management companies weak.

The Political Affairs Committee has announced plans for a second phase of legislation after establishing the virtual asset user protection law. However, it is difficult to predict whether or when regulations related to asset management companies will be included. Investors have filed criminal complaints against Haru Invest and Delio with the prosecution and are expected to pursue damages lawsuits. Gopay victims can at least hope to recover their coins once the change report is accepted, thanks to the savior Binance. The victims of this recent incident are different. In the worst case, they must prepare for a tough legal battle. Although the virtual asset market is gradually being incorporated into the regulatory framework, significant regulatory gaps still exist. To protect investors’ assets and ease their concerns, establishing fundamental legislation must be expedited.

This content was produced with the assistance of AI translation services.