South Korean Financial Regulatory Authority Requires Virtual Asset Exchanges to Secure Commercial Insurance
Publication Time:2024-08-13 13:01:07
The South Korean Financial Regulatory Authority recently issued a notice instructing all halted virtual asset exchanges to sign and purchase 'Virtual Asset Commercial Insurance', enhancing their resilience against potential threats like cyber-attacks and system malfunctions. This initiative is intended to boost the security and investor trust in the virtual asset market. It is reported that some exchanges, such as GDac and Hanbitco, have already initiated measures to acquire insurance, while platforms like HuobiKorea are also contemplating this step. According to the Virtual Asset User Protection Act that came into effect last month, all virtual asset service providers must now procure insurance. Those who fail to adhere to this requirement, either by not establishing reserves or joining a compensation scheme with a minimum limit of 50 billion Korean won, will face legal consequences and be barred from operating. This action seeks to protect the rights of virtual asset users and ensure market stability.
Risk Mitigation
Virtual Asset Exchanges
Commercial Insurance
Virtual Asset User Protection Act