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South Korea excludes NFTs, CBDCs from crypto interest mandate

South Korean Financial Services Commission , published a notice highlighting that by July 2024, investors in digital assets must receive interest when depositing their funds into an exchange. However, the guidance clarified that NFTs and central bank digital currencies are excluded from the law.

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South Korean Financial Services Commission , published a notice highlighting that by July 2024, investors in digital assets must receive interest when depositing their funds into an exchange. However, the guidance clarified that NFTs and central bank digital currencies are excluded from the law.

On Dec. 10, local media outlets reported the FSC plans to release the legislative guidance. Despite the exclusion of NFTs, the regulator also noted that there can be exceptions. According to the report, even if the tokens are categorized as NFTs but function as a payment method and are issued in large quantities, they may be included in the virtual asset classification. In this case, the assets may be eligible for interest when deposited into exchanges.

Apart from classifying virtual assets, the South Korean regulator also determined the method for handling user deposits for virtual asset operators. The notice highlighted that exchanges must separate user deposits and their own assets and entrust these to a bank. In addition, 80% of the coins must be kept in a cold wallet.

The guidance will also include requirements for preparing for hacks or other computer incidents. The regulator said that virtual asset service providers should sign up for insurance or accumulate reserves. Meanwhile, the law also prohibits the blocking deposits or withdrawals unless it’s absolutely necessary and when requested by courts and financial regulators. 

South Korea has been solidifying its regulations on the crypto space. Earlier in December, financial regulators in the country asked users to report unlicensed crypto exchanges offering services within the region. The Digital Asset Exchange Association and the Financial Intelligence Unit of South Korea were in charge of the initiative. 

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7-Eleven South Korea to accept CBDC payments in national pilot program

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7-Eleven is set to participate in the testing phase of a central bank digital currency (CBDC) initiative, running from April to June. The retail giant’s involvement highlights the growing push for digital currency integration in everyday transactions.

The pilot program will assess the feasibility of CBDC payments at 7-Eleven stores, allowing customers to make purchases using the digital currency. The initiative is part of a broader effort to explore the real-world application of CBDCs in retail environments, potentially shaping future payment systems.

As central banks worldwide accelerate their digital currency research, private sector collaboration is seen as crucial for widespread adoption. If successful, 7-Eleven’s participation could pave the way for broader CBDC usage across retail and commercial sectors.

The outcome of the testing phase will provide valuable insights into consumer adoption, transaction efficiency, and potential regulatory considerations, influencing how CBDCs are integrated into mainstream financial systems.

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SEC and Gemini ask to pause lawsuit to explore ‘potential resolution’

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The U.S. Securities and Exchange Commission (SEC) and crypto exchange Gemini have agreed to pause legal proceedings as both sides explore a potential resolution to their ongoing lawsuit. The move signals a possible settlement in the high-profile case, which centers around Gemini’s now-defunct Earn program.

The SEC initially sued Gemini, alleging that the Earn program—designed to offer users yield on crypto deposits—operated as an unregistered securities offering. Gemini has pushed back against the claims, arguing that its operations complied with regulatory standards.

By pausing litigation, both parties may be looking for a compromise that could set a precedent for crypto lending products in the U.S. A settlement could also provide regulatory clarity for similar platforms navigating SEC scrutiny.

While the outcome remains uncertain, the crypto industry is closely watching the case, as its resolution could impact future enforcement actions and the broader regulatory approach toward digital asset lending services.

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GameStop finishes $1.5B raise to add Bitcoin to its balance sheet

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GameStop has successfully completed a debt offering, raising capital that may be used to acquire Bitcoin, signaling the company’s deeper foray into digital assets. The move aligns with its broader strategy to diversify beyond traditional retail operations and into emerging financial technologies.

While GameStop has not confirmed the exact allocation of the funds, market speculation suggests that a portion could be used to buy Bitcoin, following in the footsteps of companies like MicroStrategy. The potential investment would reinforce GameStop’s ongoing pivot toward blockchain and digital assets, an effort that began with its NFT marketplace and crypto-related initiatives.

Analysts see this development as part of a growing trend of corporations exploring Bitcoin as a reserve asset amid concerns over inflation and monetary policy. If GameStop proceeds with the acquisition, it could further validate Bitcoin’s role as a strategic investment for publicly traded companies.

The company’s board will ultimately decide how the newly raised capital is deployed. Investors and the broader crypto market are watching closely for any official announcements regarding GameStop’s Bitcoin strategy.

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