The price of Bitcoin is displayed on a screen at the lounge of Bithumb in southern Seoul, Sept. 27. Yonhap

Financial authorities are gearing up for launching the tentatively named virtual asset committee by holding its kick-off meeting as early as this month, officials said Sunday.

With the launch of the committee, discussions are expected to gain momentum on key issues such as the structural problems of the virtual asset market and more legislation on cryptocurrency transactions.

The 15-member committee is a policy and institutional advisory body, chaired by the vice chairman of the Financial Services Commission (FSC), the country's top financial regulator.

Of the 15 members, six are expected to be from government agencies such as the Ministry of Economy and Finance, the Ministry of Justice, the Ministry of Science and ICT and the FSC.

The authorities are considering appointing all the other members from the private sector. The pool of private sector candidates includes legal professionals such as judges, prosecutors and lawyers; virtual asset experts like professors; employees from related organizations and associations; and those working in the consumer protection and information security sectors.

The authorities expect members from the private sector to help them gather as much feedback from the market as possible. It is reported that the selection of private sector members is currently in its final stages.

In July, the Virtual Asset Users Protection Act was implemented to toughen the rules and punishments involving virtual assets. It requires virtual asset service providers to report illegal transactions to the financial regulator, and a life sentence can be sought as the maximum punishment against unlawful gains exceeding 5 billion won ($3.7 million).

The law also requires virtual asset businesses to take measures such as purchasing insurance or accumulating reserves to fulfill their liabilities and obligations in the event of accidents such as cyberattack or equipment failure.

Since its enactment established a basic framework for user protection, there has been widespread recognition of the need for various institutional supplements to regulate the virtual asset industry more effectively.

For instance, during the National Assembly's audit of the FSC last Thursday, concerns were raised about the monopoly of Upbit, the country's largest coin exchange.

Rep. Lee Kang-ill from the main opposition Democratic Party of Korea pointed out that Upbit already holds around 70 percent of the market in terms of the number of listed coins, deposits, revenue and transaction fees, calling for measures to resolve the monopoly issue.

At the time, FSC Chairman Kim Byoung-hwan responded, “We are aware of the concerns. We will comprehensively address the structural issues of the market, including monopolies, by forming the virtual asset committee and conducting a thorough review.”

Hence, the committee is expected to discuss additional investor protection measures, as well as other issues such as allowing foreign investors and the use of corporate accounts.