This week, the Korean Financial Services Commission (FSC) published an updated draft of its code of conduct for internal staff requiring them to disclose their cryptocurrency holdings.

The measure responds to a request from the Civil Rights and Anti-Corruption Commission that has asked other institutions to take similar measures.

It encompasses staff in various roles, including writing policies for virtual assets or people involved in investigations. In addition, staff with virtual asset reporting duties or who work in industry technology are also required to report their cryptocurrency holdings.

The Korean FSC is by no means the first to require similar disclosures. For example, the US Senate implemented the requirement in 2018. The Wall Street Journal did a deep dive on who owned what.

The cryptocurrency industry is notorious for its conflicts of interest and insider trading. Coinbase employee convicted of insider trading may have been one of the first convictions, but it happens fairly regularly. Occasionally, Ledger Insights has highlighted suspicious price movements around corporate announcements.

Corporate Ethics Standards for Cryptocurrency Holdings

From an ethical perspective, these policies should also apply to companies. If someone made the decision to partner with a crypto company, does the corporate decision maker have the project token?

If a company decides to work exclusively with a single blockchain technology, did the person who made that decision own the related token? If a company plans to make an announcement that will materially influence the price of a token, what steps do they take to ensure that insiders do not benefit and control the token price around the announcement?

The real question is: do enough companies and institutions have ethical standards in this area?