South Korea rules out Bitcoin endorsement

World
Europe

South Korea’s Financial Supervisory Service (FSS) said on Tuesday it does not consider bitcoin and other cryptocurrencies to be currencies of any kind and would not seek to regulate their trade beyond rules announced last week.

“All we can do is to warn people as we don’t see virtual currencies as actual types of currency, meaning that we cannot step up regulation for now,” FSS governor Choe Heung-sik said at a press conference.

Choe added that coming up with more regulations might only spur virtual currency trading as investors might see new rules as an implicit approval of their currency status.

FSS contributed to a task force that set the nation’s first official rules around cryptocurrency trading last week.

South Korea’s government said then it would consider taxing capital gains from trading of virtual coins as regulators became worried about a bubble.

/Reuters Photo

At the same time, Japanese Finance Minister Taro Aso also said on Tuesday that bitcoin has not been proven to be a credible currency and that he would watch its developments in the near-term.

He made the remark to reporters when asked about his French counterpart’s comment this week that France would propose a discussion on regulating the virtual currency at a meeting of the G20 group of major economies next year.

“There’s no fixed definition on whether it’s a currency or not. This issue is a difficult one,” Aso said after a cabinet meeting.

“It has not yet been proven to be credible enough to become a currency, so I need to watch for a little while more.”

He added virtual currencies may be widely used in countries such as China but that they were less common in Japan, where hard currency is still preferred.

Bitcoin peaked as high as 19,666 US dollars on Sunday, whose price has risen more than 1,700 percent since the start of the year, triggering worries about a bubble.

Source(s): Reuters