- Finfluencers will need to tell their followers which digital assets they own and how much.
- The proposal was introduced by Democratic Party lawmaker Kim Seung-won.
- Any violation of the law could mean fines or potentially criminal charges.
South Korea is moving forward with a new law that would force crypto influencers to reveal what they own and how much they’re paid to promote coins. This will represent a big step toward making things more transparent and protecting everyday investors.
The bill, put forward by Democratic Party lawmaker Kim Seung-won, would amend two existing laws: the Capital Markets Act and the Virtual Asset User Protection Act. It would require so-called “finfluencers” to tell their followers exactly which digital assets they own and how much every time they talk up a token on social media, livestreams, and anywhere else.
Moreover, the finfluencers would have to say whether they got paid, sponsored, or otherwise compensated for pushing a coin. Any violations could mean fines or even criminal charges, similar to how unfair trading cases are handled.
The main goal is to stop pump-and-dump schemes, where influencers hype up tokens they already hold, pump the price, and then sell for a quick profit.
Officials believe making finfluencers disclose their holdings will cut down on shady deals and protect everyday traders in South Korea’s fast-moving, retail-heavy crypto scene.
South Korea’s Aggressive Stance on Crypto Regulation
The proposal is just one piece of a bigger regulatory push in South Korea this year. The country’s financial watchdog, the Financial Supervisory Service (FSS), has been ramping up its use of AI tools to spot weird trading patterns and suspicious market activity in real time.
Authorities have also rolled out new reporting rules in other areas, such as making people disclose crypto transactions linked to overseas property buys.
South Korea’s aggressive stance on crypto regulation makes sense given the activity of its market. Everyday traders make up a huge chunk of volume, and influencer hype has often steered where money flows. This situation got regulators worried, as without proper disclosure, inexperienced investors could easily get manipulated and end up losing money.
If the bill passes, it’ll be one of the strongest moves yet to regulate crypto influencers, a clear sign that accountability is becoming a bigger deal as digital assets go mainstream.
Related: South Korea Cracks Down on Crypto Drug Networks
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Source: https://coinedition.com/south-korea-to-force-crypto-influencers-to-reveal-personal-holdings/
