South Korea is cracking down on financial influencers ('finfluencers') by introducing new legislation that requires transparent disclosure of personal asset holdings and compensation. The proposed amendments to the Capital Markets Act and Virtual Asset User Protection Act stipulate that influencers must reveal the types and quantities of assets they hold and any compensation received when they promote stocks or cryptocurrencies.
Penalties for non-compliance could align with those of unfair trading practices, imposing fines and potential criminal charges. This move, spearheaded by Democratic Party lawmaker Kim Seung-won, aims to curb market manipulation such as pump-and-dump schemes and to bolster investor protection by ensuring promotional transparency.
The South Korean Financial Supervisory Service is also enhancing market integrity with AI-driven surveillance tools that pinpoint irregular trading activity. As a global hotspot for retail crypto trading, South Korea's aggressive regulatory stance seeks to set a precedence in managing the blurring lines between online influence and financial market dynamics.
