South Korean politicians express concerns about the crypto brain drain

South Korean politicians ask civil servants not to join crypto companies to maintain larger salary checks because the stock exchanges are fighting for strengthening the compliance departments.

According to the legislator, more and more financial supervisory authorities and police officers are leaving the public service for crypto groups that endeavor to comply with new regulations.

According to Roh Woong-Rae, a politician of the government party, an official at the middle level of the Financial Services Commission, the country's financial supervision, has terminated in the past few weeks to join Bithumb, one of the country's great crypto exchanges.

"It is as if you are leaving a cat fish," said Roh, the member of the parliamentary and environmental committee of parliament. "Since the regulations in relation to crypto-assets are still weak, we see a lax morality with some officials, including the financial supervisory authorities."

raw called the step "very inappropriate" because the financial commission is responsible for regulating crypto exchange.

According to the South Korean law on the ethics of the public service, high -ranking government officials in retirement are confronted with restrictions for new jobs in the private sector that are relevant for their previous work. Roh has urged that the applicable rules also include lower -ranking civil servants.

"Dozens of former officials such as police officers, officials from the Financial Services Commission/Financial Supervisory Service, consultants of legislators and public prosecutors, have joined crypto exchanges in recent years to negotiate with regulatory authorities," said a cryptocurrency manager.

The latest wave of personnel changes has intensified after the government had only allowed the country's four major crypto bonds to continue its Korean Won-based crypto handle, and dozens of small and medium-sized exchanges as part of a regulatory revision, which was aimed at adjusting the overcrowded crypto industry in the country.

cryptocurrency companies are exposed to increasing official control worldwide because their trading volume is growing. Binance.Us, the American subsidiary of the world's largest crypto, hired its first chief risk officer on Friday.

South Korea's crypto trade is dominated by four large stock exchanges-Upbit, Bithumb, Korbit and Coinone-which make up more than 90 percent of the country's total trading volume.

"The big players offer the supervisory authorities attractive incentives to explore them in order to make future changes to the rules cheaper for them," said Lee Chul-Yi, head of Foblgate, a medium-sized stock exchange.

After the regulation at the beginning of this year, the government recently relaxed its regulatory attitude towards crypto trade to delight young voters before the presidential elections in March.

The National Assembly passed a bill in November to postpone the planned taxation of capital wins from the trade in cryptocurrencies by one year. From 2023, the state is now planning to raise a capital gains tax from 20 percent of more than 2.5 million won ($ 2,116) from the trade in cryptocurrencies.