A Seoul-based law firm has filed a constitutional appeal over the new South Korea cryptocurrency regulation. The law firm claims that regulating cryptocurrency trading without prior social consensus and legal framework is an infringement of property rights.
The Anguk law firm filed an appeal through the Constitutional Court’s online appeal system, on December 30, Korea Times reports.
“The government’s regulation is devaluing virtual currencies by making trading very difficult,” the Seoul law firm said in a statement.
Cryptocurrencies are not recognized as legal tender or financial products in South Korea. Since there is no law affecting them, cryptocurrencies are properties or assets. Therefore, they can be traded freely and exchanged for recognized currencies or other goods with economic value, the law firm explains.
“This is an infringement on people’s property rights by the government’s unlawful measures.”
“We agree that regulations are necessary,” lawyer Jeong Hee-chan said. “But regulation should come after related laws are implemented. The petition is also a request for the government to respect people’s property rights and introduce regulations after reaching a social consensus.”
“It is very worrisome that the government is likening investors’ success to a morally reprehensible speculation without sufficient review of it,” the lawyer added.
The law firm is preparing a series of follow-up appeals filed by cryptocurrency investors and exchanges.
Emergency measures for the new South Korea cryptocurrency regulation were released mid-December.
Among other mandates, the country banned its financial institutions from dealing in cryptocurrencies – including buying, possessing, or holding them as collateral.
Banks in Korea that provide virtual bank accounts needed for cryptocurrency trades in the country will have to verify the identification of account holders when creating new ones and prohibit minors and foreigners from opening accounts.
Additionally, Seoul rolled out trade bans for minors and non-Korean residents.
South Korean cryptocurrency exchanges have already revised their policies to comply with the regulatory measures imposed by the country’s government.
South Korea cryptocurrency regulation – Image source: Inquirer.net/AP