Cross Trading of LUNA Tokens Uncovered on Three Korean Crypto Exchanges

South Korea Reveals Guidelines for Public Officials’ Virtual Asset DisclosureSouth Korea’s high-ranking government officials will soon be obliged to divulge specific information regarding their virtual asset holdings, including types and quantities, as part of their wealth declaration process. The Ministry of Personnel Management (MPM) issued a press release yesterday, announcing revisions to the Enforcement Decree of the Public Service Ethics Act. These amendments are slated to come into effect on December 14.Photo by Chris Boland on UnsplashIn addition, officials holding positions of rank one or higher will be required to disclose the methods through which they acquired their virtual assets. They must also furnish documentation of transaction records for a period of one year.These amendments to the decree come in the wake of the revised Public Service Ethics Act, which was passed in May. The primary aim of this act is to make it obligatory for government employees to declare their virtual asset holdings. The changes to the decree can be summarized into five main points.Types and amountsFirst, officials obligated to disclose their wealth must report the types and amounts of virtual assets. The prices of virtual assets traded on Upbit, Bithumb, Coinone, and Korbit — all virtual asset service providers (VASPs) designated by the Commissioner of the National Tax Service — are required to be reported using the average daily price observed on the reporting day. As for other assets, their values should align with their most recent market prices. In cases where determining these prices is not feasible, they should be reported at reasonable values that reflect transaction prices.Acquisition methodsSecond, high-level public officials must explain how they acquired virtual assets. Under the existing regulation, officials are obligated to reveal both the date and method of acquisition, along with the source of funds. However, following the adoption of the updated decree, they will also be required to provide analogous information for virtual assets.Year-long transaction historyThird, comprehensive guidelines will be established to outline the process of reporting virtual asset transaction history records. Officials subject to the disclosure requirement must divulge all virtual asset transactions conducted within the past year, even if they do not possess such assets on the day of reporting. They are obligated to furnish documentation prepared by VASPs.Officials and their family membersFourth, officials are required to permit VASPs and other relevant institutions to provide the Government Ethics Committee with information on virtual asset holdings owned by both themselves and their family members. This will be facilitated through the inclusion of virtual assets in the existing information provision agreement, similar to the approach applied to other types of assets such as real estate.Addressing conflict of interestLastly, the revised decree could potentially impose restrictions on certain public officials with regard to possessing virtual assets, especially when their responsibilities encompass tasks like formulating relevant policies, granting approval for virtual assets, and overseeing taxation matters related to them. The outcomes of these restrictions will be reported on an annual basis to the Government Ethics Committee.In a briefing regarding this development, MPM Vice Minister Lee In-ho underscored the significance of the amended decree as the regulatory framework for enforcing the requirement of public officials to declare their virtual assets. He highlighted the Korean government’s commitment to ensuring that public servants adhere to accurate reporting practices concerning virtual assets, thereby preventing unlawful accumulation of wealth.

Flybit Achieves Top Score in FIU’s Anti-Money Laundering AssessmentSouth Korean virtual asset exchange Flybit said Monday that it has received the highest rating in the comprehensive anti-money laundering (AML) evaluation conducted annually by the Financial Intelligence Unit (FIU) under the Financial Services Commission for all financial companies in Korea.Photo by REDioACTIVE on PixabayRanking among top-performing financial institutionsThe comprehensive AML evaluation is aimed at facilitating the optimal establishment and implementation of strong AML systems. It is operated under a control system where financial authorities assess and oversee a given company’s AML risk management, and the company receives verification on the adequacy of its risk management levels.In this year’s evaluation, Flybit achieved a score of 89.70, scoring in the highest ranks among all financial institutions, including virtual asset service providers (VASPs). This places Flybit among the upper echelons of financial companies that received an “Excellent” rating, which make up only 15% of all evaluated firms.Robust and varied effortsThe exchange explained that it has taken a risk-based approach (RBA) to control and manage its AML risk factors that were found in the results from the FLYBIT Enterprise-Wide AML Risk Assessment (FARA) — an AML risk assessment model developed in-house — and the FIU’s semi-annual AML system compliance evaluation, where FLYBIT was deemed as a “self-monitoring” company.Notably, Flybit operates customized AML education programs for different ranks and job roles within its corporation, which leverages both external and internal resources, including the Korea Banking Institute. It also conducts over 40 hours of advanced-level training — three times longer than the FIU recommendation — for employees directly involved in AML-related tasks.“The basis for this [evaluation] result was the active interest and support of the management, as well as the operation of a specialized AML control system for VASPs,” said Seol Ki-hwan, a compliance officer in charge of AML reporting at Flybit. “In the future, we will continue our efforts, not only in AML compliance but also in fulfilling our responsibilities and roles as a model VASP.”

The Financial Services and the Treasury Bureau (FSTB), a policy bureau attached to the government of the special administrative region of Hong Kong, has released a new digital assets policy statement, incorporating its “LEAP” framework for the digital assets industry within the city. The document, outlining the government’s objectives and guiding principles relative to the digital assets sector, builds on its first policy statement for the industry which it published in October 2022.Photo by Harry Shum on PexelsA ‘LEAP’ towards an integrated digital assets ecosystemThe FSTB suggests that this new policy statement builds upon foundational initiatives pioneered through the initial policy statement, asserting that “Hong Kong is poised to 'LEAP' towards a trusted, sustainable, and deeply integrated [Digital Assets] ecosystem embedded within the real economy.” The government agency also suggested that this “Policy Statement 2.0” also builds on the “ASPIRe” digital asset regulatory roadmap introduced by the Securities and Futures Commission (SFC) in February, outlining the next phase of digital asset sector development in Hong Kong. Strengthening global hub statusThe government has set out to home in on strategic measures to bring about greater liquidity in digital asset markets and diversify digital asset product offerings, while strengthening the Chinese autonomous territory’s position as a global hub for the digital asset sector. “LEAP” is an acronym for the proposed initiatives that underpin the new framework, including: - Legal and regulatory streamlining- Expanding the suite of tokenized products- Advancing use cases and cross-sectoral collaboration- People and partnership development The framework focuses heavily on the tokenization of real-world assets (RWA), with particular emphasis on bond tokenization. In February 2023, Hong Kong pioneered the issuance of the world’s first-ever tokenized government green bond. Building on that, it now seeks to bring about the regularization of the issuance of tokenized government bonds. The Hong Kong government would also like to see tokenization efforts expanding into “a broader range of assets and financial instruments.” It cited sectors such as precious metals, non-ferrous metals and renewable energy as candidates for tokenization. Promoting tokenized ETFsThe authorities are also encouraging tokenized exchange-traded funds (ETFs), with plans to introduce a stamp duty waiver for these products as an incentive. Additionally, the Hong Kong government is interested in nurturing the development of secondary market trading of such tokenized ETF products, whether that’s through digital asset trading platforms or other channels. The framework considers the further development of stablecoins. The city’s new licensing regimen for stablecoin issuers commences on Aug. 1. The FSTB maintains that stablecoins have the potential “to transform payments, supply chain management, and capital market activities by offering a cost-effective and efficient alternative to traditional systems.” In order to capitalize on this potential, the Hong Kong government, together with the city’s regulators, intends to enable licensed stablecoin issuers in the city “to explore and implement different stablecoin use cases.” Cyberport, a Hong Kong business park and digital technology incubator that hosts in excess of 1,650 startups, will also extend its support through its incubation ecosystem to further the objectives set out in the Hong Kong government’s new digital assets policy statement.