South Korea's FSC Slammed for Virtual Asset Policy Failures

The Financial Services Commission (FSC) of South Korea has received poor grades for its virtual asset policies in the government's internal performance evaluation. The FSC was tasked with establishing a Digital Asset Framework Act and building a stablecoin regulatory framework, but both efforts were rated 'somewhat insufficient' or 'insufficient'. Despite this, tax preparations for virtual assets are moving forward on schedule, raising concerns about policy imbalance.

The FSC's poor evaluation is due in part to the repeated postponement of the legislative timeline. The government had targeted completing legislation by the first quarter of this year, but even a draft has not been submitted to the National Assembly yet. Ten digital asset and stablecoin-related bills remain pending in the National Assembly.

Experts warn that enforcing taxation without establishing legal definitions could cause taxpayer confusion and resistance. Rep. Park Min-kyu emphasized that the FSC must promptly resolve contentious issues surrounding equity ratio restrictions and engage responsibly in legislative discussions to pass the Digital Asset Framework Act within the year.