NFT status clarified in South Korea
As local media Korea Herald reports, the question of NFT regulation began to arise as Korea’s largest entertainment company, Hive and Upbit, entered the industry. But according to the publication, this is not a surveillance objective particularly pursued by the Korean regulator for the moment.
The FSC actually relies on the recommendations of the Financial Action Task Force (FATF), which has failed to encourage governments to regulate NFTs. Its position is clear for the moment: NFTs are not seen as digital assets. They are indeed considered “unique rather than interchangeable, and not intended for payment or investment”.
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A regulation that could happen?
However, it is this last point that could pose a problem in the future. Indeed, the FATF clarified that “if [les NFT] are used for payment and investment, […] they will have to be regulated as digital assets ”. Given the current state of NFT’s markets, it is possible that regulators may recognize that these are investment tools.
Moreover, NFTs are viewed with suspicion for their possible use in money laundering. According to an FSC official, however, there will be no obligation for the moment:
“If NFTs fall under digital assets, they will be required to be reported under the law, […] but otherwise, there will be no obligation regarding the rules related to money laundering. “
For now, NFTs move more or less freely in the markets, but it is likely that their considerable weight will cause them to be scrutinized a little more closely by regulators of all stripes.
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About the author: Marine Debelloir
Deputy Editor-in-Chief on Cryptoast, I fell into the pot of cryptocurrencies a few years ago. I am passionate about the innovative technologies that arise from the blockchain and I like to find the most delicious information to share with you.
All articles by Marine Debelloir.