South Korean Regulator Eyes Crypto Staking: What’s Next?
• South Korean regulator, Financial Supervisory Service (FSS), is probing crypto staking services in the country.
• This move came after US regulators launched a legal case against staking providers and Coinbase CEO Brian Armstrong suggested that SEC may be trying to “get rid of crypto staking in the US”.
• FSS has requested data from top exchanges in the country related to their staking operations, but it is unclear if new regulations will come into effect as a result.
South Korean Regulator Probes Crypto Staking Services
The Financial Supervisory Service (FSS) of South Korea has launched a probe into domestic crypto staking services. Crypto exchanges are concerned that this could lead to new regulations surrounding staking activities.
Exchanges Provide Data to FSS
At least three of the nation’s four biggest exchanges – Upbit, Bithumb, Korbit, and Coinone – have confirmed that they had been contacted by the FSS recently regarding their staking operations. An unnamed official at one of the exchanges said that the FSS had sent them „a request for data related to staking services.“ An employee at another exchange stated that they had sent FSS staking-related data „in the third week of February“ this year.
US Regulatory Action Prompts Interest from South Korea
Earlier this month, United States regulators launched a legal case against cryptocurrency staking providers. This caused Coinbase CEO Brian Armstrong to express his concern that SEC may be attempting to “get rid of crypto staking in the US”. The media outlet noted that these developments have drawn a reaction in Seoul and prompted an investigation by FSS into whether domestic providers are following appropriate laws and regulations when engaging in cryptocurrency-related activities such as staking.
Future Regulations Still Unclear
The FSS did not comment on whether or not new regulations would be forthcoming as a result of its investigation into crypto-staking services in South Korea. However, they did suggest that an outright ban on domestic-staking was not currently being considered. It remains to be seen what form any future regulation might take or how it might affect cryptocurrency exchanges operating within South Korea’s borders.
South Korean financial regulators have begun investigating local crypto-staking services after similar regulatory action taken by US authorities caused alarm among industry participants worldwide. While it is still unclear what form any future regulation might take, it appears likely that some sort of regulation governing cryptocurrency activities such as trading and staking will eventually come into effect within South Korea’s borders too.