South Korea’s financial authorities are reviewing a plan to create a new incorporated association to carry out public self-regulation for the virtual-asset market, according to a Newsis report published Aug. 31. The proposal is being examined during second-phase discussions on the Digital Asset Basic Act.

Rather than giving legal status directly to the Digital Asset eXchange Alliance, or DAXA, authorities are considering setting up a separate statutory body. The idea would allow the new organization to operate with a formal legal basis while potentially drawing on DAXA’s rules, experience and personnel.

Why a new entity is under review

Debate over a legally recognized self-regulatory body for crypto has been taking place in the National Assembly. Bills introduced by Democratic Party lawmaker Min Byung-deok also include a plan for a statutory association, placing the issue within the broader legislative process around digital-asset regulation.

According to the report, authorities are leaning toward a separate incorporated-association model because DAXA is currently a voluntary consultative group created by the industry and does not have corporate legal status. A financial authorities official said that limitation is why officials are envisioning a new legal entity instead of simply converting the existing alliance.

How DAXA fits into the plan

DAXA was formed in 2022 by South Korea’s major won-based exchanges after the Terra-Luna collapse. Since then, it has developed an industry self-regulatory framework, including joint standards for token listings and delistings.

Even if a new association is established, authorities are considering ways to use or connect DAXA’s existing self-regulatory systems, operational know-how and specialized staff built up over the past four years. One option under discussion is a preparatory committee that would manage the launch process, from drafting bylaws and building the organization to setting rules and arranging staffing.

Possible responsibilities of a statutory body

If the new association is launched, it could be tasked with core self-regulatory functions across the market. Areas under consideration include setting standards for listings, token distribution and disclosures, monitoring suspicious or unfair trading, and mediating disputes among exchanges.

The reported model would resemble the Korea Financial Investment Association under the Capital Markets Act, an industry body that performs certain public functions under a legal mandate. The comparison suggests authorities are examining a framework that combines industry participation with statutory authority, rather than leaving oversight solely to an informal alliance.

What remains undecided

The timing of any launch and the precise scope of the association’s powers have not been finalized. For now, the proposal remains part of the ongoing second-phase talks on the Digital Asset Basic Act.

As those legislative discussions continue, the National Assembly is expected to work out the details of the body’s structure, legal basis and responsibilities. Until then, the central question is not whether DAXA’s experience will matter, but how much of it can be carried into a newly established statutory organization.

Source: en.bloomingbit.io