The South Korean Financial Regulator Financial Supervision Service (FSS) has declared that he currently does not plan to regulate the digital currency trade like Bitcoin, beyond the "rules announced last week". The watchdog based his decision on the fact that he does not consider digital currencies as a substitute for money because they are not legal tender in the country.

At a press conference on the issue, Choe Heung-sik claimed that the only role the regulator should play in the digital monetary space is to warn the public potential risks:

"All we can do is warn people because we do not see virtual currencies"

He also added that the introduction of any cryptocurrency regulations in the country will only promote digital currency trading, as investors will think that the watchdog already recognizes cryptocurrency as "real" currency.

The Governor's remarks are similar to his previous statements. In November 2017, he announced that the FSS will not directly oversee the operations and activities of the digital currency exchanges since the virtual currencies exchanged do not have legal tender in the country.

Given its position, the government issued several rules, rather than establish regulations, to monitor the local Bitcoin sector and digital currency.

In the past, the main exchanges in the country were preparing and ready for all sorts of regulatory and compliance measures.

In addition to a number of rules that have already been enacted, the National Tax Service (NTS) is developing a framework on how to effectively collect taxes on cryptocurrency transactions.

The ETN will most likely introduce capital gains taxes for businesses and individuals who trade in digital currencies.