Bank of Korea Proposes Circuit Breakers for Cryptocurrency Exchanges

The Bank of Korea has proposed measures to enhance the safety and transparency of cryptocurrency exchanges in South Korea, following a recent market disruption caused by Bithumb's mistake.

According to a payments report published on Monday, the central bank suggests introducing 'circuit breakers' that would halt trading on exchanges if crypto prices suddenly fluctuate. This mechanism is similar to the one used by the Korea Exchange to suspend trading in case of abnormal market movements.

The Bank of Korea notes that the virtual asset industry currently lacks internal control mechanisms and faces lower regulatory intensity compared to established financial institutions. As a result, the central bank recommends strengthening relevant regulations to prevent similar incidents and enhance investor protection.