South Korea Considers Class Action Lawsuits for Unfair Crypto Trading

Financial regulators in South Korea are actively exploring the possibility of implementing a class action lawsuit system to address unfair cryptocurrency trading practices. The primary aim of this initiative is to safeguard investors’ interests, a longstanding objective for South Korean officials. The notorious Terra incident has intensified the focus on devising effective measures to protect cryptocurrency investors.

Unveiling Plans for Unfair Crypto Trading Scenarios

The Financial Services Commission (FSC) in South Korea has drafted an internal report outlining the proposed class action lawsuit system, which Kukmin Ilbo recently obtained. The report states:

“A bill to enact a class action law that can be applied to general illegal activities, including the securities sector, has been proposed to the National Assembly. We can accept various alternatives, including adding the field of virtual assets to this bill.”

Notably, the FSC’s report highlighted that cryptocurrencies are not considered finance. However, it remains uncertain if other regulatory bodies will echo this stance.

Investigating Token Listing Bribes

Should further evidence surface, South Korean officials are also expanding their efforts to scrutinize potential token listing bribes. Insiders suggest that it is common for trading platforms in South Korea to list specific tokens in exchange for bribes.

An ongoing investigation into this matter has led to several developments. One such incident involved the arrest of a former Coinone employee who allegedly accepted 1.5 million in bribes to list 25 assets.

The cryptocurrency exchange market in South Korea has been facing tumultuous times with a series of security breaches and legal issues. Notably, GDAC suffered a $13 million hack, while Bithumb was raided by the police in connection with a price manipulation probe.

A Step Forward in Investor Protection

The South Korean government’s consideration of a class action lawsuit system for unfair cryptocurrency trading practices marks a positive step towards ensuring investor protection. 

With ongoing investigations into token listing bribes and an increasingly volatile crypto exchange market, implementing such a system could provide much-needed security for investors in the rapidly evolving digital asset landscape.

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