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Media CoverageBinance's acquisition of Gopax faces difficulties, with customer deposits held hostage.
As Binance, the world’s largest cryptocurrency exchange, faces difficulties in acquiring the domestic virtual asset exchange Gopax, it has played a "hardball" card. Binance has threatened that unless financial authorities approve its acquisition of Gopax, it will be unable to return the 50 billion KRW in customer assets tied up in Gopax. (omitted) Pureun “Ian” Hong, managing partner at Decent Law Firm, which specializes in virtual assets, stated, "According to Article 7, Paragraph 3 of the Special Financial Information Act, a virtual asset service provider cannot have its registration accepted if it has a criminal record, such as being fined for financial-related crimes in Korea." He further explained, "Binance is currently under pressure from the U.S., so while it may not be easy to punish the company under domestic law, if the authorities take this into account, they could exercise discretion and reject the registration change of the board of directors.
2023-05-09 biz.chosun -
Media Coverage
U.S. SEC vs. Exchanges, Virtual Assets: 'Securities vs Commodities'
Host: Anchor Choo Hye-jung Guest: Hyeonsu “Elliot” Jin, managing partner at Decent Law Firm Q. What is the current state of virtual asset regulation in Korea? The government is pushing to amend the Enforcement Decree of the Special Financial Information Act The Financial Information Act does not reflect current market conditions, which is problematic Applying the Capital Markets Act to virtual assets is excessive Q. What is the current state of virtual asset regulation in the U.S.? The U.S. SEC is strengthening virtual asset regulations Ongoing debates between the U.S. SEC and exchanges over whether virtual assets are 'securities vs. commodities' The SEC has filed mass indictments against cryptocurrency exchanges, causing Bitcoin to wobble on the New York Stock Exchange Q. What is the current state of virtual asset regulation in Europe? The European Union passed the world’s first Markets in Crypto-Assets (MiCA) law "Europe will soon be the global standard"... the Brussels effect on the crypto market Q. Is the legislation of the Basic Digital Asset Law gaining momentum? With the passage of the Virtual Asset User Protection Act by the National Assembly’s Political Affairs Committee, there is growing optimism for legislation In Korea, uniform regulation is applied to tokens Domestic regulations on non-security digital assets: ① Disclosure regulations ② Unfair trading regulations ③ Operator regulations Q. What are disclosure regulations? Proposed disclosure regulations: ‣ Limiting the qualifications of digital asset issuers to domestic and foreign corporations ‣ Requiring submission of a digital asset plan to the regulatory authorities If intermediary fees are generated during digital asset transactions, compliance with issuance disclosure obligations is expected Q. What are unfair trading regulations? Unfair trading regulations are expected to include prohibitions on price manipulation and fraudulent trading activities Specific conditions such as insider scope and the importance of information are to be discussed Q. What are operator regulations? Planned provisions include changes to entry requirements for unregistered digital asset businesses Regulations are expected to address obligations such as digital asset custody and prohibitions on incomplete sales Digital assets must be segregated and managed separately from the company’s proprietary assets Q. What are the U.S. regulatory requirements for virtual assets? In 2022, U.S. Congress submitted the Lummis-Gillibrand bill U.S. digital asset regulatory measures: ① Security token regulations ② Commodity token regulations ③ Payment ④ Consumer protection The U.S. applies activity regulations based on token types If security-type digital assets comply faithfully over a certain period, disclosure obligations may be eased Digital asset issuers are required to disclose token information Q. What are the EU regulatory requirements for virtual assets? The EU passed the world’s first virtual asset law, MiCA, which will take effect in June next year The EU recognized the need for specific laws on crypto-assets to protect investors EU applications of crypto-assets: ① As an alternative payment method ② As a new fundraising tool Alternative payment methods provide efficient international opportunities by limiting intermediaries New fundraising tools minimize burdens on small and medium-sized enterprises (SMEs) in securing capital The EU's MiCA law lays the foundation for the digital age of crypto-assets In Korea, regulations are focused on protecting investors by imposing restrictions on operators
2023-05-08 NBN NEWS -
Media Coverage
Shin Hyun-seong of 'Terra' indicted on charges of Capital Markets Act violation and fraud.
Host: Reporter Jang Se-jin Guest: Pureun “Ian” Hong, managing partner at Decent Law Firm Q. Shin Hyun-seong of 'Terra' indicted on charges of Capital Markets Act violation and fraud Shin Hyun-seong, General Representative of Chai Corporation Prosecutors recognized the 'securities nature' of Luna Coin… the first indictment case in Korea Q. What is the full story of the 'Terra-Luna' crash? Algorithm-based stablecoins: Luna (LUNA) and Terra (UST) "Terra's price will always be $1" The formula of '1 Terra = $1' broke The collapse of the dollar peg impacted the entire virtual asset market Q. What is the current status of the investigation into 'Terra-Luna'? 'Terra-Luna cryptocurrency incident' led to the arrest of Do Kwon in Montenegro 'Terra' Shin Hyun-seong indicted for Capital Markets Act violation and fraud Q. What is the difference between a dismissed arrest warrant and an indictment? Unrestricted investigation: an investigation conducted without the suspect being detained Q. When is a suspect detained and indicted? Detention and indictment occur when there is a risk of flight or evidence tampering Q. What is detention and indictment? Detention and indictment involve requesting a court trial while the suspect is in custody Q. Will Shin Hyun-seong face an unrestricted indictment? Prosecutors indicted 10 people, including 'Terra-Luna' co-founder Shin Hyun-seong, without detention Q. What are the charges against Shin Hyun-seong in the unrestricted indictment? Prosecutors stated, "The Terra project was a fiction that could not have been realized from the beginning" Shin Hyun-seong indicted for Capital Markets Act violation and fraud Q. What is the connection between the 'Terra-Luna' incident and the Capital Markets Act? The indictment of Shin Hyun-seong over Terra-Luna marks the first case of recognizing 'coins as securities' "The standard for determining whether coins are securities will impact the future of the virtual asset market" Q. How does the Capital Markets Act apply to Shin Hyun-seong’s charges regarding coin securities? "Luna is a security"... the Terra-Luna fraud marks the first indictment under the Capital Markets Act Q. Why did the court's ruling on the 'Terra-Luna' case diverge? In the investigation of the 'Terra-Luna' incident, the key issue is defining 'investment contract securities' Q. Why is the determination of coin securities so important in the 'Terra-Luna' case? If Terra-Luna is recognized as a security, strict regulations will apply The case highlights the need for new laws governing coins Q. What is the future direction of the trial for Terra-Luna co-founders Shin Hyun-seong and Do Kwon? Prosecutors emphasize that proving the securities nature is 'key'
2023-04-28 NBN NEWS -
Media Coverage
Coinbase launches a 'counterattack' with a lawsuit against the U.S. SEC
The largest global cryptocurrency exchange in the U.S., Coinbase, has launched a counterattack against the U.S. Securities and Exchange Commission (SEC). On the 24th of this month (local time), Coinbase filed a lawsuit forcing the SEC to respond to a petition it had previously submitted. In July of last year, Coinbase submitted a petition to the SEC, asking for answers to 50 questions, including how existing securities laws could be applied to virtual assets and the method for classifying virtual assets as securities. (omitted) Hyeonsu “Elliot” Jin, managing partner at Decent Law Firm, stated, "Since the lawsuit has been filed, the SEC must respond. However, if the SEC replies that it has already provided sufficient guidelines and explanations, there is a high likelihood that the lawsuit will be dismissed. Coinbase is likely aware of this and has made a strategic decision." He added, "As the largest cryptocurrency exchange in the U.S., it won’t be easy for Coinbase to leave the U.S. entirely. However, there is a strong possibility that they will separate their U.S. and overseas services to continue providing them."
2023-04-27 Korea Economy -
Media Coverage
Crypto Issues: The Scalability of DeFi and Digital Assets, and the Need for Domestic and International Regulation
Host: Anchor Choo Hye-jung Guest: Hyeonsu “Elliot” Jin, managing partner at Decent Law Firm Q. First, can we start by discussing what DeFi is? DeFi (Decentralized Finance) Financial services provided through blockchain technology without the control of a central institution Q. What are some examples of DeFi? NFT marketplace 'OpenSea' The Luna-Terra DeFi system Q. What is the difference between Centralized Exchanges (CEX) and Decentralized Exchanges (DEX)? Q. What is the difference between claims and property rights? Claims provide specific rights and obligations between creditors and debtors Property rights involve ownership based on possession of a specific item In coin transactions, users deposit KRW or coins according to their contract, thereby holding claims "In case of exchange hacking or bankruptcy, the assets must be distributed equally" "Decentralized hardware wallets are unaffected by exchange bankruptcy" Q. Is the SEC pushing for DeFi regulation? The SEC is promoting DeFi regulation, and the U.S. Congress is preparing a bill on stablecoins Q. Is DeFi included in the scope of virtual asset service providers (VASPs)? DeFi is not included in the scope of VASPs under the Special Financial Information Act "There are no clear legal regulations for DeFi at this time" A U.S. SEC specialist commented, "Regulating DeFi may lead to the extinction of new technologies" There are internal disagreements within the U.S. SEC regarding regulation of decentralized exchanges Q. Is there a need for DeFi regulation? Investors are aware of the risks involved in DeFi investments but proceed due to high potential returns "Regulation is needed for hacking prevention and mandatory disclosure" Q. What are some examples of risks in DeFi investments? "High returns are often used as bait to attract investors to secure liquidity" "Depending on the product design, investors can adopt various strategies" "Investors may face losses if the price of the coin used in DeFi drops sharply" Q. What is the stance of regulatory agencies? "Regulatory agencies aim to protect investors" "Unfair behavior by coin operators can lead to delisting at the discretion of the exchange" Q. What would be the correct direction for DeFi regulation? "DeFi provides a new investment avenue that ensures individual freedom" Since DeFi lacks a supervisory body, investor protection is currently insufficient "Excessive regulation of the DeFi market should be avoided"
2023-04-21 NBN NEWS -
Media Coverage
1000% Profit? If You Know 'This', You Won't Be Fooled
As the prices of virtual assets like Bitcoin are once again on the rise, cases of victims falling prey to illegal fundraising schemes and pyramid schemes due to insufficient scrutiny are increasing. From January to March, the Financial Supervisory Service received 59 consultations and reports related to illegal fundraising disguised as virtual asset investments, a 47.5% increase compared to the same period last year. Financial authorities and the National Police Agency have warned investors to be cautious as these fraudulent methods continue to evolve. (omitted) Attorney Hyeonsu “Elliot” Jin of Decent Law Firm explained that there are five key things to know to prevent cryptocurrency fraud. The first is to emphasize "ID verification." Attorney Jin stated, "You should check the other party's ID, take a photo or record the information as evidence, and since IDs can be forged, it’s also a good idea to ask for additional documents such as a seal certificate." Using a "credit card" can also be a preventive measure. It is safer than coin transactions, which are difficult to trace, and wire transfers, which make recovering lost funds challenging. Additionally, visiting the company's address listed at the bottom of the virtual asset website, checking whether the terms and conditions are properly written, and confirming if the virtual asset is traded on domestic exchanges are also effective methods. Attorney Jin advised, "If you fall victim to fraud or suspect fraudulent activity, it is more efficient to consult a lawyer, gather evidence, and then proceed with legal actions such as filing a complaint or lawsuit, rather than reporting the issue immediately."
2023-04-16 Korea Economy TV