Category Archives: Korean Blockchain Association

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Ethereum Co-Founder Says Time for South Korea to Deregulate Blockchain

Ethereum Co-Founder Says Time for South Korea to Deregulate Blockchain

Ethereum founder Vitalik Buterin has urged South Korean regulators to remove restrictive blockchain industry laws in a recent visit to the Asian tech powerhouse.

Buterin was speaking to South Korean parliament members in a hope to overturn the government’s current stance which currently favors blockchain over Bitcoin and other cryptocurrencies, by its banning of ICOs.

The Ethereum Canadian-Russian crypto entrepreneur was quick to point out that separating the two key aspects of the burgeoning tech and payments industry wasn’t feasible due to their interdependence. He also explained that ICOs have moved considerably since the early days of cryptocurrency and scams are now rare, adding “ICOs have certainly improved, and will continue to improve in the future”. He argued:

“Blockchain is a technology that can be run without cryptocurrencies, but there is no crypto without blockchain. Public blockchains rely heavily on cryptography. Therefore, cryptocurrencies are absolutely necessary.”

The initial banning of ICOs in South Korea was implemented by President Moon Jae-in. also removing generous tax breaks for crypto businesses after a number of high-profile crypto scams. The approach has impacted the industry in the country which has largely flourished despite prohibitive government intervention and legislation.

Last year, Chin Dae-je, chairman of the Korean Blockchain Association, made a strong case for legalizing ICOs, suggesting that they offered a way creating new jobs, boosting the economy and producing innovative world-leading blockchain startups in the country, commenting:

“The government should implement guidelines to nurture the domestic blockchain industry, which will help Korea emerge as a global industry leader… Startups who comply with guidelines should be allowed to launch ICOs.”

Both Buterin and Reddit founder Alexis Ohanian agree with these sentiments as cryptocurrency emerges from what it calls a “crypto winter”, suggesting that a purge of bad actors and scams over this period is creating a much healthier crypto environment. Ohanian said:

“The speculators have fled and that’s great. Because the people who are now building on crypto are true believers. They’re actually building the infrastructure that it’s going to take to really make this happen.”

 

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Korean Blockchain Association Argues to Legalize ICOs to Boost Startups, Save Crypto Exchanges

The battle to for global blockchain supremacy rages on in South Korea as the head of the Korean Blockchain Association makes further calls to legalize initial coin offerings (ICOs).

Economic rhetoric

Chin Dae-je, chairman of the Korean Blockchain Association, made a strong case for the presently banned fundraising method whilst speaking at a National Assembly Library seminar in Yeouido, western Seoul.

Believing that ICOs are the key to creating new jobs, boosting the economy and producing innovative world-leading blockchain startups, the chairman said:

“The government should implement guidelines to nurture the domestic blockchain industry, which will help Korea emerge as a global industry leader… Startups who comply with guidelines should be allowed to launch ICOs.”

ICOs have been a point of contention in many nations as they struggle to classify and regulate cryptocurrency tokens. Furthermore, ICOs have a muddied history of scams and fraudulent activities that caused knee-jerk responses from many governments such as the United States and South Korea, who banned ICOs or made them incredibly difficult to launch.

While investor and consumer protections have been at the crux of the contentious debate, so has the stifling of domestic blockchain enterprise and innovation in South Korea. According to the report, disallowing domestic ICOs has resulted in startups setting up shop in jurisdictions that accommodate ICOs such as Hong Kong, Japan, and Thailand.

Despite this claim, South Korea is home to a robust blockchain market with major investors and traditional companies beginning to enter the space and drive innovation. In addition to this, city governments, as well as national government entities, are largely in favor of backing the technology through public sector pilot projects, funding, education, and implementation.

Team effort

The Korean Blockchain Association is no underdog however in its mission to legitimize ICOs; in September the governor of the Financial Supervisory Service called for an international standard for ICO and cryptocurrency regulations.

Furthermore, the Committee Chairman of the National Policy Committee spoke at the Korean National Assembly, furthering the argument that the present stance is causing global competition to get ahead.

As reported by local media outlet Korea Joongang Daily, Chin said, “By regulating and allowing ICOs, we can nurture start-ups with high potential, create jobs and reduce youth unemployment […] We can designate public or private organizations like the Korean Blockchain Association to look over the ICO white papers and verify the purpose of their fundraising.”

During his proposal, Chin offered up his organization as well as suggested other public or private entities as potential regulatory bodies that would oversee the verification of ICO whitepapers.

Trouble in tandem

Also backing cryptocurrency exchanges, Chin proposed for the government to make it easier for exchanges to set up new user accounts for Korean fiat deposits and withdrawals. He believes that should an exchange adhere to an approved standard of security measures, it should be allowed to “issue new virtual accounts”.

Chin considers these issues to have a knock-on effect to one another, arguing that if domestic exchanges disappear, then local startups seeking to gain funding through ICOs will be up against significant financial challenges and would result in domestic cryptocurrencies being listed on to foreign exchanges.

Highlighting the present impacts he said, “Korean exchanges that were ranked as the fourth or sixth-largest in the world before are dropping to below 20th place now.”

Also speaking at the seminar was Democratic Party representative Min Byung-doo, who has been backing pro-blockchain legislation. He said, “We cannot completely close the door on ICOs… The government needs to promote the blockchain industry by cooperating with the National Assembly and blockchain associations to curb scams, speculation and money laundering.”

 

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