In a dramatic turn of events, the South Korean National Assembly has voted to introduce the first crypto-specific legislation to the country.
Bitcoin takes a huge leap closer to mass adoption
When South Korea announced a potential ban to be placed on the operations of all cryptocurrency exchanges, the price of Bitcoin dropped 25%. But the National Assembly shocked and delighted crypto investors and enthusiasts earlier today (March 5th, 2020) by switching their view on cryptocurrency exchanges entirely.
In this dramatic turnaround, reliable sources state that the house voted unanimously (182 – 0) to pass the bill, which focusses largely on how cryptocurrency brokerages and exchanges will be governed by regulatory authorities.
These companies create a large portion of revenue through trading in crypto derivatives. While discussions regarding the closing down of all operations of these exchanges began in January 2018; a compelling argument was made late last year in favour of CFD’s (Contract for Difference).
It is the responsibility of the PCFIR (Presidential Committee on the Fourth Industrial Revolution) to deliberate upon important policies regarding the development and acquisition of new science and technologies. The organisation announced that the revenue generated through crypto derivatives was around $64 million for 2019 and made an official recommendation in January, this year.
They suggested that the Korean government should continue to allow crypto-related products, such as Bitcoin derivatives as a medium- and long-term strategy toward the institutionalisation of cryptocurrencies.
Longer Reach, Tighter Grip?
So, what does this vote mean for the long-term prospects of cryptocurrency? Well, the largest challenge that even the most successful cryptocurrencies face is the future prospect of mass adoption. The passing of this bill will certainly set a precedent to the rest of the world, providing an example of how these new digital assets can be embraced by a nation’s government to provide prosperity and progress.
In order for this idealistic view to be realised, however, regulation and oversight must govern the practices of all financial institutions that deal with cryptocurrency. The uncontested decision reached by the South Korean National Assembly today brings Bitcoin and all altcoins that much closer to being fully integrated into our economy but will also introduce tighter guidelines and strict codes of practice that financial institutions will have to adhere to.
It also means that anonymous transactions through the use of cryptocurrency will likely become obsolete in South Korea in the near future; but if you are a die-hard privacy buff, you needn’t worry, there will almost certainly be a work around.
All in all, this vote is a huge win for cryptocurrency. Tighter regulation and oversight mean better prospects for mass adoption, stability and support from the government. The potential impact of this bill pertaining to the future of crypto cannot be overstated.