High Profile Gov’t Official in Korea Calls For Better Crypto Regulation For First Time
Earlier this week, Min Byung-doo, the chairman of Korea’s National Policy Committee, encouraged the government to impose better and more practical regulatory frameworks to govern the local crypto market.
Most of the reports following the speech of chairman Min at the National Assembly of South Korea meeting focused on his call for the legalization of the initial coin offering (ICO) market, given the interest of local investors towards the ICO of major corporations including Kakao, the country’s biggest Internet conglomerate.
But, for investors, it is more important to consider the fact that for the first time in history, a high profile government official of the ruling party has publicly called for the legitimization of the cryptocurrency and blockchain sector.
Let Investors Build Trust Towards the Crypto Market
The essence of chairman Min’s speech on Wednesday revolved around a core message delivered to the federal government that the authorities should not restrict the market and over-regulate the cryptocurrency sector.
He emphasized that while regulation is necessary and crucial to facilitate the growth of the market, it has to be implemented in a way that it does not have a negative impact on local startups, crypto-related ventures and blockchain projects.
In mid-2018, lawmakers of South Korea introduced a draft of the country’s first crypto and blockchain-related legislation, which positively recognized cryptocurrency exchanges as regulated financial institutions and blockchain projects as innovative startups working to lead the fourth industrial revolution.
Critics of the legislation have stated that the government may be limiting the market to investors by becoming overly involved in the activities of local cryptocurrency exchanges.
“Regulation is not bad. Regulation is necessary, it is the only way to legitimize the market and allow investors to build trust towards the cryptocurrency market,” chairman Min explained, requesting lawmakers and regulators to impose practical policies that can allow investors to gain trust in the market.
Chairman Min also asked for the legalization of the ICO, as many local publications and international media outlets reported. However, the main component in the speech of chairman Min was that the government has to start acknowledging trends in the global crypto and blockchain market to prevent from being left behind.
ICO is one of many trends which the government has dismissed by implementing a blanket ban. In the months and years to come, as the crypto and blockchain space continues to grow, he noted that it is of utmost importance for the economy of South Korea that the government puts in sufficient efforts to understand emerging trends and technologies.
“The government cannot dismiss ICO. It needs to allow companies to conduct ICO. ICO has become a new trend in the global market and it is the responsibility and ability of the government to embrace new technologies. We can see that the flow of investment is clearly changing compared to ICO and angel fundraising. The ICO has raised $1.7 billion for Telegram and $4 billion for Block.One, It is getting bigger and bigger.”
Expect Actual Change in the Local Market
Seoul and Busan, two of the largest cities in South Korea, have started to impose favorable regulations for crypto startups since August. Park Won-soon, the mayor of Seoul, said that given the lack of activity at the federal government level, regional governments have to lead by example and embrace cryptocurrency companies.
Led by Seoul, Busan, Jeju Island and Sejong have established mid-term roadmaps to lure in emerging blockchain projects and established cryptocurrency companies.
Jeju Island has already begun the process of legalizing ICO in the area, which is possible because the island can operate independently from the federal government with its own regional policies.