As indicated by Yonhap, the Republic of Korea Fair Trade Commission (KFTC), the nation’s regulatory authority for economic competition, “ordered 12 cryptocurrency exchanges to revise their adhesion contracts, which largely fail to provide adequate protection for consumers.”
Consumer protection in South Korea is regulated under a few acts, including the Consumer Protection Act, and furthermore more particular acts, for example, the Adhesion Contract Act, enacted December 31, 1986.
It was later updated for the internet age and is known as The Act on Consumer Protection in Electronic Commerce (E-Commerce Act). Its charter gives a shield on the consumer side amid online transactions. It’s the main law the KFTC is appealing to. The KFTC is likewise looking over standard terms and conditions rules, and these are upheld by means of the Regulation of Standardized Contracts Act (RSCA).
With the RSCA, the onus is on the business to unveil all benefits and duties, including what is alluded to in the US as the small print. The Korean Supreme Court decided that the standard is “contractual terms that would typically affect a reasonable consumer’s decision to enter into a contract or how prices are set for the concerned transaction (for example, product warranty or disclaimer of liability).”
“According to the Fair Trade Commission,” Yonhap continues, “existing guidelines unfairly bar users from withdrawing their deposits, or limit their services to users, and force users to shoulder all financial losses when they secede from membership.”
South Korean digital currency exchanges have been extremely active recently. Huobi has officially launched in South Korea, encouraging “the trading of 100 cryptocurrencies and 208 markets.” As far as regulation, these pages additionally announced how the “Kakao-backed cryptocurrency exchange Upbit has launched a system to reward users for identifying fraudulent multi-level schemes related to cryptocurrencies.”
Just within two weeks, nonetheless, three exchanges were raided by prosecutors who they “suspected of buying bitcoin with money stolen from customers’ accounts,” News.Bitcoin.com documented. This happened roughly a month after over “twenty cryptocurrency exchanges in South Korea have agreed to voluntarily undergo evaluations” in a broader effort to better self-regulate.