South Korea Gets Strict with NFTs: New Guidelines Released

South Korea’s financial regulators have issued new guidelines under the “Virtual Asset User Protection Act” to clarify which NFTs fall under virtual asset regulations. The Act, which takes effect on July 19, 2024, aims to increase regulatory clarity in the growing NFT market. Previously, NFTs were generally excluded from the virtual asset classification. However, the […]

The post South Korea Gets Strict with NFTs: New Guidelines Released appeared first on Coin Edition.

South Korea Gets Strict with NFTs: New Guidelines Released

  • NFTs with mass issuance or divisibility are now classified as virtual assets in South Korea.
  • Businesses must register as virtual asset operators if their NFTs meet the new regulatory criteria.
  • NFTs used for payments or exchange with virtual assets face stricter regulatory scrutiny.

South Korea’s financial regulators have issued new guidelines under the “Virtual Asset User Protection Act” to clarify which NFTs fall under virtual asset regulations. The Act, which takes effect on July 19, 2024, aims to increase regulatory clarity in the growing NFT market.

Previously, NFTs were generally excluded from the virtual asset classification. However, the new guidelines specify that NFTs with certain characteristics — such as mass issuance, divisibility, or use as a means of payment — will now be classified as virtual assets.

The guidelines outline several key points. NFTs designed for “content collection purposes” are typically excluded from virtual asset regulations. NFTs are first evaluated to determine if they qualify as securities under the Capital Markets Act. If so, securities regulations apply.

NFTs are considered virtual assets if they meet specific c…

The post South Korea Gets Strict with NFTs: New Guidelines Released appeared first on Coin Edition.