- South Korea announces new supervisory fees for crypto exchanges as part of the VASP Act.
- The nation has made several advancements in the crypto regulatory sectors.
The cryptocurrency sector in South Korea encountered a revised version of the FSC’s Virtual Asset User Protection Act. This revised version included a charge of supervisory fees for leading crypto exchanges such as Upbit, Bithumb, Coinone and GOPAX. The exchanges are required to pay a regulatory fee of 300 million Won worth $220K approximately.
Notably, South Korea’s regulatory body, the Financial Securities Commission (FSC) released the VASP Act, which went into effect on July 19. The Act specifies the type of exchanges and institutions that can issue the crypto assets.
Presently, the revised versions are ‘Enforcement Decree of the Act on the Establishment of the Financial Services Commission’ and the ‘Regulations on the Collection of Financial Institution Contributions. According to the two announcements, South Korea’s crypto exchanges are charged fees based on their operating revenue from the previous fiscal year.
While the law will take effect starting next year, it can be seen as similar to Quasi-tax paid by financial institutions. Moreover, the charges are due to the crypto exchanges being included in the Financial Supervisory Service’s inspection target. Relatedly, the FSC also announced that inspections will take effect in the coming months.
How Will the Fees Impact Crypto Exchanges?
The South Korean regulatory body, as aforementioned, announced a supervisory share rate for exchanges’ fees. As per the rate, according to the country’s local reports, Upbit will be required to pay a fee of 141 million KRW out of the total 163 million KRW.
The other three crypto exchanges, Bithumb, Coinone, and GOPAX will be required to pay the remaining 22 million KRW. One particular exchange, Korbit, might be excluded from the supervisory fees due to low operational revenues.
Relatedly, the crypto exchanges with higher operational revenue may not incur losses due to the fees. However, firms such as Coinone and GOPAX might face difficulties in generating profits from operational revenue.
Recently, the South Korean government considered postponing crypto taxation for three years. In the past few months, the nation has made several advancements within the crypto regulatory sector.
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