Clarification Needed on Licensing and Scope of Financial Companies and Virtual Asset Operators

To foster the growth of the domestic virtual asset industry, there is a call to clarify the licensing and service scope of financial companies and digital asset operators. On the 10th, attorney Kim Hyo-bong emphasized at a seminar held in Seoul that the ambiguity of regulations is a significant issue. He explained that the integration of traditional finance and digital assets is rapidly progressing in the United States, with blockchain transactions of existing financial products and the connection of tokenized financial products to DeFi. U.S. regulatory authorities are specifying regulations related to digital asset ETFs and are streamlining systems to allow for the swift market entry of products that meet certain requirements. Attorney Kim diagnosed that the boundaries of traditional finance are becoming blurred as non-custodial wallets and DeFi converge. He stressed the importance of distinguishing between technology provision and financial services, explaining the regulatory differences between cases where users make direct trading decisions and those where specific operators make trading decisions. He also noted that the definition of DeFi could be subject to regulation depending on whether authority is concentrated in specific entities. He pointed out that in South Korea, the scope of work for financial companies and digital asset operators has not been sufficiently clarified.