I INTRODUCTION TO THE LEGAL AND REGULATORY FRAMEWORK
There is considerable public interest in cryptocurrencies and blockchain in Korea.2 For example, on 16 January 2018, a petition to the President entitled Opposing Cryptocurrency Regulation garnered more than 200,000 signatures.3 On 14 February 2018, the government responded to the petition by stating that it considers the transactional transparency of cryptocurrencies to be of paramount importance, but that it will also promote blockchain technology.
As such, the government conceptually differentiates policies related to cryptocurrency from those of blockchain technology. Although some regulations have been introduced to curb speculative investment in cryptocurrency, the government has highlighted the innovative nature of blockchain technology in many different industries. It has also expressed its interest in fostering, promoting and investing in blockchain technology as part of its strategic and economic plans for Korea to be a leader in the Fourth Industrial Revolution.
However, there is no coherent insight on how cryptocurrencies would be classified under Korean law. The Financial Supervisory Service issued a press release on 23 June 2017 to announce its views on what cryptocurrencies are not from a financial regulatory perspective:4 namely, cryptocurrencies are not considered fiat currencies, prepaid electronic means or electronic currencies, or financial investment instruments. Unfortunately, the press release did not provide any guidance on how cryptocurrencies are classified and in what legal form. In addition, cryptocurrencies are not insured by the Korean Deposit Insurance Corporation.5
The government is largely concerned with the protection of investors and consumers of cryptocurrency. It has shown particular concern regarding cryptocurrency-related illegal activities, such as multilevel schemes and money laundering; accordingly, on 5 March 2020, the National Assembly of Korea passed the Amendment to the Act on Reporting and Use of Certain Financial Transaction Information, which expands anti-money laundering obligations to virtual asset service providers. However, the government has reiterated that the regulation of cryptocurrency transactions does not signify endorsement or institutionalisation of cryptocurrencies.6
The Supreme Court of Korea ruled on 30 May 2018 that cryptocurrencies can be confiscated as criminal proceeds.7 This decision represents the first time the Supreme Court has recognised cryptocurrency as property. However, given the narrow scope of its interpretation, it is unclear what impact this ruling will have on subsequent cryptocurrency regulation.
Classification of cryptocurrencies from a legal perspective has just begun in Korea and will likely develop in the near future. Other Korean regulatory authorities may have a different view from the Financial Supervisory Service's announcement and the legal classification of cryptocurrencies. As a result, there is currently no law or clear guidance from any regulatory authority in Korea that provides clarity on the legal classification of cryptocurrencies and how they will be treated under Korean law.
II SECURITIES AND INVESTMENT LAWS
The main legal framework governing securities and investment in Korea is the Financial Investment Services and Capital Markets Act (FSCMA). There is no existing regulatory regime or statute that incorporates cryptocurrency into Korean securities and investment laws.
The FSCMA defines securities as:
financial investment products for which investors do not owe any obligation to pay anything in addition to the money or any other valuables paid at the time of acquiring such instruments (excluding obligations to pay where an investor assumes such an obligation by exercising a right to effectuate the purchase and sale of an underlying asset), provided that there are certain securities, such as investment contract securities, which are only recognised as securities under the FSCMA when meeting certain conditions under the FSCMA.8
On the other hand, the FCSMA defines financial investment products as:
a right acquired by an agreement to pay, at the present time or a specific time in the future, money or any other valuables, for the purpose of earning a profit or avoiding a loss, where there is a risk that the total amount of such money or any other valuables, paid or payable, to acquire such right (excluding any sums specified in the Enforcement Decree, such as sales commissions) may exceed the total amount of money or any other valuables recovered or recoverable from the right (including any sums specified in Enforcement Decree, such as termination fees).9
It is currently unclear whether cryptocurrencies qualify as securities or financial investment products under the FSCMA. In a series of press releases, Korean financial authorities have taken the position that cryptocurrencies or cryptocurrency assets are not a financial investment product under the FSCMA.10 However, these announcements were made in the context of cautioning potential investors, and thus do not adequately address whether cryptocurrencies qualify as financial investment products under the FSCMA.
There is no explicit prohibition on the registration of cryptocurrency-related investment funds. A licence must be acquired to provide advice on financial investment products in Korea. Since an investment fund's underlying asset need not be financial investment products under the FSCMA, an investment fund may, in theory, include cryptocurrencies or cryptocurrency assets as its underlying assets. However, it is unclear whether the Korean financial regulators will be receptive to such investment funds. To date, there are no cryptocurrency-based investment vehicles or funds registered with the Korean financial regulatory agencies.
On 1 September 2017, the Financial Services Commission (FSC) announced a ban on margin trading, prohibiting individuals from borrowing funds or cryptocurrencies from cryptocurrency exchanges to sell them.11 The FSC has declared that this practice violates existing Korean lending and credit laws. It has further directed financial institutions to halt all transactions and partnerships that enable margin trading.
III BANKING AND MONEY TRANSMISSION
On 4 September 2017, the FSC announced that it would initiate an identification policy for accounts in cryptocurrency exchanges that requires cross-checking user names and account numbers. On 30 January 2018, the FSC introduced the Real Name Verification System.12 Under the Real Name Verification System, users who want to make a cryptocurrency transaction must have a bank account under their real name at the same bank with the cryptocurrency exchange. Existing anonymous account users can only withdraw money and may not make any further deposits. The Real Name Verification System further bans minors (under the age of 18) and foreigners from opening new cryptocurrency accounts.
There are no explicit border restrictions or obligations to declare cryptocurrency holdings. However, for fiat currencies, the Foreign Exchange Transaction Act (FETA) and the Foreign Exchange Transactions Regulations (FETR) regulate the remittance of funds out of Korea to overseas accounts. Generally, there must be a legal basis, along with supporting documents as prescribed under the FETA, to repatriate funds overseas. Examples of a legal basis include loan repayments, dividend payments and sale proceeds payments. The FETA prescribes certain procedures and documents for each type of transaction listed in the FETA for both the remitter of funds and the bank handling the remittance. Each type of transaction has different procedures and requirements to remit funds overseas. Generally, under the FETA, all outbound remittance in an amount exceeding US$3,000 per transaction or a yearly aggregate limit of US$50,000 must be reported to and approved by the Bank of Korea (BOK).
There are no guidelines regarding cryptocurrencies under the FETA or the FETR. In practice, however, Korean banks decline to process wire transfers overseas when related to cryptocurrency trading, even if the amount is below the monetary limits and would not trigger the reporting requirements to the BOK or designated foreign exchange bank under the FETA.
Moreover, for overseas payments using cryptocurrencies, there are no reporting requirements at this time to any Korean regulatory agency. However, there are requirements being developed by the Korean financial regulators that may require a filing requirement with the BOK for foreign exchange purposes.
On 9 January, 2018, the BOK launched a task force on cryptocurrency and is reviewing a central bank-backed cryptocurrency as part of the project. In addition, various local governments in Korea are exploring the option of issuing their own cryptocurrency.
IV ANTI-MONEY LAUNDERING
The main legal framework governing anti-money laundering (AML) is the Act on Reporting and Use of Certain Financial Transaction Information (the AML Act). On 5 March 2020, the National Assembly of Korea passed the Amendment to the AML Act, in response to the growing global consensus for the need to establish international standards for AML and combating the financing of terrorism (CTF). Specifically, in October 2018, the Financial Action Task Force (FATF), of which Korea is a member, resolved to include AML and CTF requirements for virtual asset service providers (VASPs) in the FATF Recommendations.13 The FATF published the Interpretive Note with details in June 2019 and is scheduled to monitor the implementation status of Member States in 2020.14 As a Member State, and to comply with the FATF Recommendations, the Korean legislature enacted the Amended AML Act, which will come into effect on 25 March 2021.
Prior to the Amended AML Act, Korean financial regulators, such as the Financial Intelligence Unit (FIU), indirectly monitored virtual currency markets through financial institutions that are linked to cryptocurrency exchanges. The FIU published the Anti-Money Laundering Guidelines for Cryptocurrencies (the AML Guidelines) on 23 January 2018, and amended them in June 2018.15 Under the AML Guidelines, financial institutions interacting with businesses handling virtual currency (e.g., virtual currency exchanges, wallet service providers) have been conducting enhanced know-your-customer verification of these businesses and monitoring fiat transactions between them and their customers for suspicious transactions.
The Amended AML Act, however, directly imposes certain AML obligations on VASPs. The key provisions of the Amended AML Act are outlined below.
i Reporting requirement for VASPs
Under the Amended AML Act, a VASP is require to filed a report (the VASP Report) to the Commissioner of the FIU, and this report must be approved by the FIU before the VASP may engage in the business of:
- sale and purchase of virtual assets;
- exchange of virtual assets;
- mediation or arrangement of the activities described in points (a) and (b);
- storage or management of virtual assets; or
- other activities with virtual assets to be set out in the enforcement decree.16
The VASP Report must contain: the VASP's company name; the name of the VASP's representative; the location of the VASP's place of business; and the VASP's contact information.17 Failure to report will result in criminal punishment of imprisonment of up to five years or a fine of up to 50 million won.18
The Commissioner of the FIU may refuse to approve the VASP Report on grounds such as (1) the VASP has not acquired an Information Security Management System (ISMS) certification or (2) the VASP engages in customers that do not have a 'real name' deposit and withdrawal account opened in the customer's own name at the same financial institutions where the VASP also has an account.19 Accordingly, this VASP Report filing requirement is expected to function as a de facto licensing requirement.
ii AML requirements for VASPs
As with other financial institutions, VASPS will be subject to various AML requirements, including filing of suspicious transaction reports and currency transaction reports, and conducting customer due diligence.20 VASPs will be required to set up an internal control system to fulfil such requirements in good faith and to separately manage transaction details by customer.21
iii Expanded customer due diligence on financial companies
A financial institution entering into any arrangement with a VASP must ensure that the VASP has satisfied the VASP Report requirements and the requirement to separately manage deposits made by its customers from its own assets, and has acquired an ISMS certification.22 A financial institution must decline or terminate transactions with the VASP if it does not have a valid VASP Report, has not acquired an ISMS certification or enters into a financial transaction without a deposit and withdrawal account that allows real name verification.23 A financial institution declining or terminating transactions must decide whether to file a suspicious transaction report.24
V REGULATION OF EXCHANGES
Cryptocurrency exchanges do not require financial licences, nor are they subject to the AML Act. However, the various proposed bills pending at the National Assembly seek to require cryptocurrency exchanges to obtain financial licences and to impose anti-money laundering requirements directly on the exchanges.
Regulation of cryptocurrency exchanges in Korea primarily takes the form of self-regulation. The Korea Blockchain Association (KBCA) is a trade association of cryptocurrency exchanges that self-regulates cryptocurrency exchanges.25 As the KBCA's regulation only binds its members, non-member exchanges would not be subject to the KBCA's regulation. As part of its self-regulation, KBCA requires that member exchanges abide by the Commercial Act and maintain equity of at least 2 billion won. The KBCA also mandates that the exchanges deposit all their monetary deposits with financial institutions and use cold storage for at least 70 per cent of their cryptocurrency deposits to protect investors' funds. The KBCA's regulation also mainly covers:
- increasing the transparency of initial coin offerings (ICOs);
- strengthening the verification of account holders' identification;
- operating offline customer centres;
- strengthening the ethics of executives and employees; and
- forming independent committees on self-regulation.
On 16 April 2018, the KBCA announced plans to review its member cryptocurrency exchanges according to the self-regulation provisions.26 Upon review of 12 member exchanges, it announced on 11 July 2018 that all exchanges have met the minimum requirements of the self-regulation provisions.27
In addition, the government indirectly regulates cryptocurrency exchanges through existing laws. As cryptocurrency exchanges are registered as corporations, they are subject to various cybersecurity and privacy laws that are also applicable to other corporations. The Ministry of Science and ICT (MSIT) has been reviewing the cybersecurity measures adopted by cryptocurrency exchanges since September 2017.28 The MSIT requires exchanges with total sales over 10 billion won and over 1 million daily visitors to acquire an information security management system pursuant to the Act on Promotion of Information and Communications Network Utilisation and Information Protection. As of December 2018, the four largest exchanges are subject to this requirement.
In addition, cryptocurrency exchanges may be required to register a chief information security officer (CISO) with the MSIT. The MSIT will cooperate with CISOs to minimise further damage in the event of hacking attacks or other cybersecurity threats. The Korea Internet and Security Agency also plans to monitor and promptly address the dissemination of malicious codes within, and distributed denial-of-service attacks against, cryptocurrency exchanges.
VI REGULATION OF MINERS
There is no law or regulation explicitly regulating mining of Bitcoins or other cryptocurrencies. However, based on statements from Korean financial regulatory authorities, it appears that mining itself may not be illegal per se. In a 22 June 2017 press release, the Financial Supervisory Service noted that retail mining would be unsuccessful owing to limited computing power, which may imply that retail mining would not be illegal.29 Similarly, an Office for Government Policy Coordination press release issued on 22 December 2017 implies that mining itself would not be illegal.30 In that press release, the government noted that mining in industrial complexes while taking advantage of discounted electricity fees is illegal and that the Ministry of Trade, Industry and Energy has already requested a local government to monitor sudden spikes in electricity use. These statements seem to imply that what is illegal is the misuse of discounted electricity, not mining itself.
Subsequently, on 31 January 2019, the government announced the result of its monitoring of the ICO practice in Korea and its proposed approach to regulate ICOs. In this announcement, it stated that it had identified companies bypassing its prohibition on ICOs by performing ICOs through offshore companies in foreign jurisdictions (such as Singapore) while raising funds from domestic investors. The government found that this practice substantively constitutes domestic ICOs, albeit in the form of a foreign ICO, and further stated that domestic investors were at significant risk as a result of this because the companies performing the ICOs did not disclose substantial information for the investors to make an informed decision.
In addition, the government also deemed that certain ICO projects may violate the FSCMA if they involve the issuance and transaction of peer-to-peer collateralised loan tokens, the sale of cryptocurrencies investment funds or the operation of unauthorised financial investment business by providing investment services with IPO tokens.
As ICOs pose a high investment risk and lack a global regulatory framework, the government announced that it will take a conservative approach in legalising them. Further, it maintained an equivocal position on whether it will publish an ICO guideline, as doing so may give the market the impression that it has officially approved domestic ICOs, which is not the case.31
VII REGULATION OF ISSUERS AND SPONSORS
A government task force on cryptocurrency, composed of, among others, financial regulators, foreign exchange regulators and tax regulators, issued a press release on 4 September 2017 entitled Status and Direction for Cryptocurrency.32 The press release states that the Korean regulators will penalise acts of ICOs as violations of the FSCMA where cryptocurrencies are issued in the form of securities, such as investment contract securities, and the issuer has not complied with the offering restrictions under the FSCMA. Although the Korean regulators' initial position was to penalise ICOs in the form of securities issuances (i.e., in cases where the token is classified as a security), the regulators subsequently took a stricter position in another press release on 29 September 2017, announcing their new policy that any types of ICOs (including those in the form of securities) would be prohibited.33
If coins or tokens qualify as securities under the FSCMA, ICOs will be subject to offering or sales restrictions in Korea. Under the FSCMA, an offer or sale of securities to 50 or more non-accredited investors (excluding professional investors) would be regarded as a public offering and be subject to offering restrictions under the FSCMA. In a public offering of securities in Korea, an onshore or offshore issuer must file a securities registration statement for the securities to be offered in Korea with the FSC.
In contrast, if coins or tokens are not securities under the FSCMA, then ICOs would not be subject to securities offering restrictions under the FSCMA, and there would be no grounds for the prohibition of ICOs unless they trigger a violation of other existing Korean laws or regulations. However, given the stance of the Korean financial regulatory authorities, it is possible that they would take an expansive view of the existing laws and regulations and cause difficulties for issuers.
Fundraising activities are subject to the Act on the Regulation of Conducting Fund-Raising Business Without Permission (the Fund-Raising Business Act). This Act prohibits guaranteeing a return of the original investment amount or an amount exceeding an original investment amount when raising funds.34 In addition, making any indication or advertising of one's business so as to carry on prohibited acts constitutes a violation of the Fund-Raising Business Act.35 Thus, when marketing or promoting an ICO, if an issuer promises a return of the original investment amount or an amount exceeding the original investment amount, it will likely be in violation of Fund-Raising Business Act. The regulatory authorities have indicated that they will seek to amend the Fund-Raising Business Act so that all cryptocurrency-related fundraising activities are violations of the Act. However, it is currently unclear whether this amendment would pass.
VIII CRIMINAL AND CIVIL FRAUD AND ENFORCEMENT
Chapter XXXIX (Article 347 et seq.) of the Criminal Act governs fraud, whereas tort law under Article 750 of the Civil Act governs civil fraud. The government has been actively investigating and prosecuting fraud and other criminal acts related to cryptocurrency. For example, on 10 May 2018, the head of a multilevel scheme that advertised that the company turns profit by purchasing Bitcoins in countries with lower prices and selling them in countries with higher prices was convicted of fraud and sentenced to seven years in prison.36 Similarly, a board member of the company was convicted of the same crime and was sentenced to four years in prison. The company offered 20 per cent of the new investment amount from new participants to the referee participant and provided other incentives to participants who were successful in attracting more investments. The court stated that the company received funds by defrauding customers even though there was no guarantee of recovering the original investment. In addition, there have also been investigations and prosecutions of fraudulent acts of cryptocurrency exchanges.
In a press release dated 28 December 2017, the government stated that it will continue to investigate and prosecute illegal acts related to cryptocurrency, and will seek to impose the maximum penalties allowed by the relevant laws.37 The government further announced in 2018 that it will focus on the following:
- multilevel fraud schemes and the undertaking of fundraising activities without permission;
- investment fraud related to cryptocurrency mining;
- violations of the FETA;
- concealment of criminal proceeds via money laundering, etc.; and
- illegal acts of cryptocurrency exchanges.
The Ministry of Strategy and Finance has announced that plans for the taxation of cryptocurrencies are being developed, but no decisions have been made. When the government introduced the Real Name Verification System on 30 January 2018, it listed data collection for taxation purposes as a benefit of the system, implying taxation. To date, the Korean tax authorities have established a task force (the Tax Task Force) to review taxation of virtual currency or other digital assets, and have been reviewing a new proposal that could provide clearer guidance on how it taxes cryptocurrencies.38 The Tax Task Force appears to be considering several options, including: reclassify returns made on cryptocurrencies as a type of 'other income', placing it in the same category as money earned (e.g., lottery winnings); and classify the returns as 'capital gains', such as in the case of stock trades or real estate sales and purchases.39 The Ministry of Strategy and Finance is considering including provisions pertaining to cryptocurrency taxation in the amendment to tax laws, which is scheduled to be prepared in 2020.40
The National Tax Service has published its preliminary assessment of taxation on cryptocurrencies following its annual forum in 2017.41 This assessment is not an official policy, but it is the only published position or research on cryptocurrency taxation by the government. The National Tax Service's assessment noted that cryptocurrencies are hybrid products that have characteristics of, inter alia, fiat, securities and goods. Based on this determination, the National Tax Service has made a preliminary assessment of taxation on cryptocurrencies under the existing tax laws as summarised in the table below.
|Corporate income tax||11–27.5||Taxable under current law||Need accounting standards for categorisation and valuation of cryptocurrency|
|Income tax||6.6–46.2||Taxable under current law||Need accounting standards for categorisation and valuation of cryptocurrency|
|Corporate or individual VAT||10||Undecided||If cryptocurrency is viewed as means of payment, then no tax; if cryptocurrency is viewed as goods, then levying VAT is advisable|
|Capital gains tax||6.6–46.2||Undecided, but for retail investors, levying capital gains tax is advisable||N/A|
|Inheritance and gift tax||10–50||Taxable under current law||Cryptocurrency is a property with economic value, and thus taxable; need valuation standards for cryptocurrency|
X OTHER ISSUES
If the use of cryptocurrency increases in money laundering or for other criminal purposes, and in light of the Supreme Court's decision holding that the government may seize cryptocurrency as criminal proceeds, the seizure of cryptocurrencies may increase. Typically, seized properties are sold through public auction with the proceeds going to the government. The Korea Asset Management Corporation, which manages Onbid, a public auction system, has indicated that public auctions would be possible for cryptocurrencies, noting cryptocurrencies' similarities to securities.42 However, given the volatility of the price of cryptocurrencies, it may not be advisable to dispose of seized cryptocurrencies through a regular public auction process. The government has yet to decide how it will dispose of the cryptocurrencies seized in connection with the Supreme Court case.
Another issue that arises as the use of cryptocurrency increases is consumer protection. The Act on the Regulation of Terms and Conditions (the T&C Act) governs terms and conditions in contracts. The Korea Fair Trade Commission (KFTC) has indicated that placing limitations on the withdrawal of funds or having excessive waiver provisions may be a violation of the T&C Act.43 It has also indicated that, if necessary, it would issue corrective orders and impose penalties for this practice.
On 5 April 2018, the KFTC announced that it had reviewed the terms and conditions of user agreements of 12 cryptocurrency exchanges.44 The review called for changes of 14 terms and conditions that the KFTC deemed unfair. The following changes were voluntary: the deletion of terms and conditions that allowed for the monetisation of cryptocurrencies of members who did not log in for six months or more; and the deletion or amendment of terms and conditions that allowed the indemnification of damages in cryptocurrency or won points, which is virtual won money in the accounts of users in cryptocurrency exchanges to purchase cryptocurrencies. In addition, the KFTC issued corrective recommendations to the exchanges covering 12 types of terms and conditions, including:
- unfair limitations on the withdrawal of funds;
- arbitrary restrictions on the use of services;
- responsibility over user identifiers and passwords; and
- broad waiver provisions.
Furthermore, the KFTC noted the increase in the online advertisement of cryptocurrencies, and that the industry needs to self-regulate to avoid excessive advertisement.
XI LOOKING AHEAD
The government recognises the innovative nature of blockchain technology and its potential impact on the Korean economy. Although it has been hesitant to endorse or institutionalise cryptocurrencies, and has repeatedly warned investors about the potential dangers of investing in them, it has expressed interest in fostering, promoting and investing in blockchain technology as part of its strategic and economic plans. Furthermore, while the central government appears to be uneasy about cryptocurrencies, some local governments have shown interest in issuing their own cryptocurrencies.
Although the Amended AML Act was passed in March 2020, there is still no coherent insight on how VASPs and cryptocurrencies (virtual assets) would be regulated under Korean law. As the Amended AML Act will come into effect on 25 March 2021, we expect to find a more coherent framework for the regulation of cryptocurrencies and other related issues. Currently, the amendment to tax laws involving cryptocurrencies is scheduled to be prepared later this year; if passed, the amendment may provide more clarity on classification of cryptocurrencies.
1 Jung Min Lee and Joon Young Kim are senior attorneys and Samuel Yim is a senior foreign attorney at Kim & Chang.
2 In this chapter, Korea refers to South Korea.
4 Financial Supervisory Service, press release, 23 June 2017, http://m.fss.or.kr:8000/fss/board/bodoBoardDetail.do?seqNo=20581&gubun=01&mId=M01050200000000.
6 See, e.g., FSC, press release, 28 May 2018, https://www.fsc.go.kr/info/ntc_news_view.jsp?bbsid=BBS0030&page=1&sch1=subject&sword=%EA%B0%80%EC%83%81%ED%86%B5%ED%99%94&r_url=&menu=7210100&no=32491.
8 FSCMA Article 4.
9 id., Article 3.
10 FSC, press release, 13 December 2017, https://www.fsc.go.kr/info/ntc_news_view.jsp?menu=7210100&bbsid=BBS0030&no=32202; Financial Supervisory Service, press release, 23 June 2017, http://m.fss.or.kr:8000/fss/board/bodoBoardDetail.do?seqNo=20581&gubun=01&mId=M01050200000000.
11 FSC, press release, 28 December 2017, https://www.fsc.go.kr/info/ntc_news_view.jsp?bbsid=BBS0030&page=1&sch1=subject&sword=%EA%B0%80%EC%83%81%ED%86%B5%ED%99%94&r_url=&menu=7210100&no=32230.
12 FSC, press release, 28 December 2018, https://www.fsc.go.kr/info/ntc_news_view.jsp?bbsid=BBS0030&page=1&sch1=subject&sword=%EA%B0%80%EC%83%81%ED%86%B5%ED%99%94&r_url=&menu=7210100&no=32230.
13 FATF, Regulation of Virtual Assets, 19 October 2018, https://www.fatf-gafi.org/publications/fatfrecommendations/documents/regulation-virtual-assets.html.
14 FATF, Public Statement on Virtual Assets and Related Providers, 21 June 2019, http://www.fatf-gafi.org/publications/fatfrecommendations/documents/public-statement-virtual-assets.html.
16 Amended AML Act, Articles 2(i)(n) and 7(1).
17 id., Article 7(1).
18 id., Article 17(1).
19 id., Article 7(3).
20 id., Articles 4 to 5-4.
21 id., Article 8.
22 id., Article 5-2(1)(iii).
23 id., Article 5-2(4)(ii).
24 id., Article 5-2(5).
25 Korea Blockchain Association, press release, 15 December 2017, http://www.kblockchain.org/site/program/board/basicboard/view?menuid=001004002&pagesize=10&boardtypeid=4&boardid=116.
26 Korea Blockchain Association, press release, 16 April 2018, http://www.kblockchain.org/site/program/board/basicboard/view?menuid=001004002&pagesize=10&boardtypeid=4&boardid=176.
27 Yonhap News, 11 July 2018, http://www.yonhapnews.co.kr/bulletin/2018/07/11/0200000000AKR20180711083051002.HTML?input=1195m.
28 Ministry of Science and ICT, press release, 21 December 2017, http://www.msit.go.kr/web/msipContents/contentsView.do?cateId=mssw311&artId=1370974.
29 Financial Supervisory Service, press release, 22 June 2017, http://www.fss.or.kr/fss/kr/promo/bodobbs_view.jsp?seqno=20581&no=1&s_title=%B0%A1%BB%F3%C5%EB%C8%AD&s_kind=title&page=2.
30 Office for Government Policy Coordination, press release, 22 December 2017, http://www.korea.kr/briefing/pressReleaseView.do?newsId=156244619&pageIndex=1&repCodeType=&repCode=&start Date=2008-02-29&2018-07-20&srchWord=%EA%B0%80%EC%83%81%ED%86%B5%ED%99%94.
31 FSC, press release, 4 September 2017, https://www.fsc.go.kr/info/ntc_news_view.jsp?bbsid=BBS0030&page=2&sch1=subject&sword=%EA%B0%80%EC%83%81&r_url=&menu=7210100&no=32027.
32 FSC, press release, 4 September 2017, https://www.fsc.go.kr/info/ntc_news_view.jsp?bbsid=BBS0030&page=2&sch1=subject&sword=%EA%B0%80%EC%83%81&r_url=&menu=7210100&no=32027.
33 FSC, press release, 29 September 2017, https://www.fsc.go.kr/info/ntc_news_view.jsp?bbsid=BBS0030& page=2&sch1=subject&sword=%EA%B0%80%EC%83%81&r_url=&menu=7210100&no=32085.
34 Act on the Regulation of Conducting Fund-Raising Business Without Permission, Articles 2 to 3.
35 id., Article 4.
36 Herald Corporation, 10 May 2018, http://news.heraldcorp.com/view.php?ud=20180510000071.
37 FSC, press release, 28 December 2017, https://www.fsc.go.kr/info/ntc_news_view.jsp?bbsid=BBS0030&page=1&sch1=subject&sword=%EA%B0%80%EC%83%81%ED%86%B5%ED%99%94&r_url=&menu=7210100&no=32230.
38 Asia Today, 18 December 2017, http://www.asiatoday.co.kr/view.php?key=20171217010008451.
39 The Kyunghyang Shinmun, 8 December 2019, http://news.khan.co.kr/kh_news/khan_art_view.html?art_id=201912081609011.
40 IT Chosun, 13 June 2020, http://it.chosun.com/site/data/html_dir/2020/06/12/2020061204350.html.
41 National Tax Service, press release, 5 December 2017.
42 However, the Korea Asset Management Corporation is not in charge of regulating the finance sector, and thus its view of whether cryptocurrency is or is similar to a security cannot be viewed as the government's position on whether cryptocurrency is a security under the FSCMA.
44 KFTC, press release, 5 April 2018.