The top financial regulator in South Korea, the Financial Services Commission, has suggested a change to the credit financing statute that would effectively forbid locals from using credit cards to buy cryptocurrency.

According to the regulator, this new amendment’s primary goal is to prevent domestic cryptocurrency dealers from purchasing cryptocurrency on overseas exchanges. The FSC stated in its legislative notice that the decision was made in response to worries about the illicit outflow of domestic funds, money laundering, and the promotion of speculative activity.

Up until February 13th, the regulator intends to gather public input on the proposed amendment. Yonhap News Agency reports that it is anticipated to be examined and put to a vote with the goal of being implemented in the first half of 2024.

Users of cryptocurrency in South Korea must trade using withdrawal and deposit accounts on local exchanges, validated with their real names, as per a 2021 revision to the financial reporting law. In order to offer fiat-to-crypto services, local trading platforms must also go through stringent regulatory requirements, which include forming an alliance with a local bank.