KEY POINTS
Financial Services Commission in South Korea has recently published new guidelines for regulating Non-Fungible Tokens (NFTs).
The new guidelines explicitly state that under certain circumstances, NFTs will be subject to the Virtual Asset User Protection Act — slated to come into full force this July.
Locals have reported that newspaperFSC treats NFTs as regular cryptos if large amounts are produced or if the NFTs can be traded with other digital assets.
NFTs may be considered virtual assets, especially if their non-fungibility or uniqueness is lost.
FSC guidelines define specific situations where virtual assets would apply to NFTs. The FSC’s guidelines outline specific scenarios where NFTs would be considered virtual assets.
If NFTs are able to be traded for virtual assets, or be used as a payment method for services and goods, then they’ll likely be regulated under virtual assets.
FSC intends to evaluate each case individually, without any rigid criteria. The FSC will use this approach to determine whether a NFT is regulated as an asset.
Regulation of NFTs is a controversial topic in the Web3 community. China announced last year NFT theft a crimeThis is a response to the growing concerns about digital collectibles fraud.
The global regulatory framework for NFTs is inconsistent. Various reports highlight both their risks and benefits.
The U.S. Treasury published its first quarterly report in April. NFT risk assessmentThis report identified the vulnerabilities of fraud, theft and manipulation on the market. In the report, it was recommended that regulations be strengthened and awareness raised to ensure market integrity and safety for consumers.
U.S. Copyright Office and U.S. Patent and Trademark Office jointly published a comprehensive report The intersection of NFTs with intellectual property laws. The report focuses on the challenges of NFTs and possible solutions.
A UK Committee has expressed concern about the future of the UK in 2023. NFT copyright infringements– The advertising of NFTs and their integration into sports. In the report, government action was called for to protect both creators and fan.
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Source: blog.cryptoflies.com