South Korea is set to implement a framework imposing liability standards on cryptocurrency exchanges similar to those applied to banks, in response to the recent security breach at Upbit.
The Financial Services Commission (FSC) is currently examining a no-fault compensation system that would require exchanges to compensate customers for losses incurred due to hacks or operational failures, even if the exchange isn't directly at fault, as reported by The Korea Times.
This model is typically applicable to banks and electronic payment companies under the Electronic Financial Transactions Act. By extending these regulations to the crypto sector, South Korea is taking one of the most significant steps yet to align digital asset platforms with traditional financial institutions.
This regulatory effort comes in light of the Nov. 27 security incident at Upbit, managed by Dunamu, where over 104 billion Solana-based tokens were swiftly transferred to external wallets in less than an hour, amounting to approximately 44.5 billion won ($30.1 million).
Swiss federal prosecutors announced last week that they are filing charges against Credit Suisse, its current owner UBS, and a former compliance officer for failures related to anti-money laundering measures tied to a significant corruption and fraud scandal in Mozambique.
In 2013 and 2014, the Zurich-based bank facilitated more than $2 billion in loans for three Mozambican state-owned enterprises aimed at modernizing the nation’s fishing infrastructure. Although the projects never came to fruition, corrupt bankers and local officials managed to siphon off over $130 million in bribes from the scheme.
The Office of the Attorney General of Switzerland revealed that Credit Suisse is being charged with failing to prevent money laundering due to significant "organizational deficiencies." It was noted that the bank reported its suspicions of money laundering to the MROS, the nation’s financial intelligence unit, only in 2019, after US authorities unsealed charges against three former Credit Suisse bankers.
Additionally, prosecutors have revealed money laundering charges against a former compliance officer, who was responsible for investigating a dubious $7 million transfer from a Mozambican state entity into a Credit Suisse corporate account in 2016, which was subsequently sent to the United Arab Emirates.
President Karol Nawrocki has exercised his veto power against a bill aimed at regulating the crypto-assets market in Poland, which was set to align the nation with European Union standards. The government maintained that this legislation was essential to safeguard consumers and leverage market opportunities for Poland. However, Nawrocki, aligned with opposition views, argued that these regulations pose significant risks to Polish citizens' freedoms and could undermine state stability.
In June, the government approved this bill, crafted to ensure Poland adheres to the EU's Markets in Crypto-Assets (MiCA) framework. The proposed legislation would have empowered the Financial Supervision Authority (KNF) as the regulatory authority overseeing the crypto-asset landscape.
Companies in this sector would have been mandated to report their activities to the KNF, which would have had the authority to enforce sanctions if necessary. Additionally, the legislation aimed to introduce criminal liability for violations related to crypto-assets.