S. Korean supreme court recognizes financial value of virtual money

By Lim Chang-won Posted : May 30, 2018, 15:29 Updated : May 30, 2018, 15:29

[Reuters/Yonhap News Photo]


SEOUL -- Financial officials are still reluctant to see virtual money as legal, but South Korea's top court ruled Wednesday that cryptocurrencies can be confiscated, recognizing their value as financial assets for the first time.

There has been a social debate in South Korea over whether cryptocurrencies should be recognized as financial products. Financial officials have refused to recognize them as legal money.

On Wednesday, the Supreme Court established a legal precedent, upholding an 18-month prison sentence and a penalty of 696 million won ($642,660) against a 33-year-old man identified by his surname Ahn, who was arrested in May last year for operating an illegal pornography site to earn 1.9 billion won.

Ahn received virtual money from users of his site. The highest court ordered a forfeit of 191 bitcoins.

Initially, a district court rejected a request from prosecutors to seize Ahn's virtual money, saying bitcoin is an electronic file format without physical entities. However, the high court overturned the lower court's decision and ruled in favor of prosecutors, saying that in reality, economic activities are being carried out to give a certain economic value to cryptocurrencies.

The Supreme Court ruled that cryptocurrencies should be recognized as financial assets because they can be exchanged into legal currencies.


 
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