[2023 National Audit] Lee Bok-hyun "Strong Doubt About Whether Coin Exchanges Have Conflict of Interest Blocking Systems"

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Lee Bok-hyun, Governor of the Financial Supervisory Service (FSS), stated, "I personally have strong doubts about whether there is a system in place at DAXA (Digital Asset Exchange Joint Council) or individual (virtual asset) exchanges that can block conflicts of interest."

On the 17th, during the FSS audit by the National Assembly's Financial Services Committee held at the FSS office in Yeouido, Governor Lee explained, "For example, compared to the Korea Exchange, there is a Market Surveillance Committee or various systems that can block conflicts of interest." He also added, "I would like to respectfully ask the National Assembly to consider the need for secondary legislation."

On the same day, Min Byung-duk, a member of the Democratic Party of Korea, pointed out issues regarding the price decline and circulation volume discrepancies of virtual assets. He also mentioned that DAXA had not taken measures related to these issues and suggested separating the authority for listing and delisting virtual assets on exchanges.

Governor Lee said, "Since the first legislation, various preparations have been underway, and although more efforts will likely be made by July next year, we are currently in discussions with DAXA before the legislative details are finalized." He added, "The first legislation did not sufficiently include content related to issuance regulation, so under the current legal framework, there are not many areas where we can exercise mandatory control authority."

Earlier in June, the National Assembly passed the "Act on the Protection of Virtual Asset Users," which includes regulations to protect users of the virtual asset market and prevent unfair trading practices. The law will be enforced starting July next year after going through the government's promulgation procedures.

Governor Lee emphasized, "There is a systemic limitation that makes it difficult to enforce mandatory measures without voluntary cooperation regarding related matters at this time." He continued, "If there are issues related to Burger Coin (a coin issued overseas and traded domestically) through the first legislation, we will be able to take some actions starting July next year, so we will prepare thoroughly."

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