South Korea Lifts Crypto Business Restrictions, Grants Venture Status

TLDR

• South Korea will lift restrictions on crypto businesses starting September 16.
• Crypto firms can now apply for venture company status, unlocking tax breaks and financing support.
• The government aims to foster growth in the crypto and blockchain sectors.
• Existing venture companies can expand into crypto without losing their status.
• South Korea’s crypto market is projected to reach $1.1 billion by 2025.

South Korea is lifting restrictions on crypto businesses, allowing them to qualify as venture companies. This change will grant them access to tax breaks, research grants, and financing support. The new policy will take effect on September 16.

Crypto Firms Can Apply for Venture Certification

The Ministry of SMEs and Startups announced a revision to the Enforcement Decree of the Venture Business Act. This revision removes previous restrictions that prevented crypto companies from gaining venture status. As a result, these companies can now apply for venture certification, opening doors to several benefits.

Ted Koo, an attorney at LIN, emphasized the advantages of this change.

He also noted that existing venture companies can expand into the crypto space without losing their status.

The Ministry hopes the new measure will foster the growth of the crypto sector in South Korea. It expects increased development in virtual asset trading, brokerage services, blockchain, and cybersecurity. The revision aligns with global trends in digital asset industries.

South Korea Shifts Stance on Crypto

South Korea initially imposed a ban on crypto businesses in 2018 due to concerns about speculative trading. However, recent changes reflect a shift in the government’s stance towards the industry. The Ministry cited improvements in user protection and global market evolution as reasons for lifting the ban.

The decision follows public consultations and input from industry experts. South Korea’s evolving crypto policies are aimed at positioning the country as a leader in digital asset technologies. By providing more opportunities for growth, the government plans to secure future growth momentum in the sector.

The election of President Lee Jae-myung in June has also contributed to this policy shift. Under his leadership, South Korea has pushed forward with various crypto-related laws, including a bill to legalize stablecoins. These moves have created a friendlier environment for crypto businesses.

Crypto Market Growth Drives Innovation in South Korea

According to Statista, South Korea’s crypto market will reach $1.1 billion in revenue by 2025 and, according to projections, grow to $1.3 billion by 2026. The country’s crypto exchange user base has already surpassed 16 million, representing over 30% of the population.

This growth reflects a broader trend in South Korea’s tech-forward approach to the digital economy. As the crypto market expands, the revised regulations are expected to drive even more innovation. South Korea is positioning itself to become a hub for blockchain and cryptocurrency industries in the region.

In conclusion, South Korea’s decision to grant crypto firms ‘venture company’ status opens up significant opportunities. The country’s growing crypto market and supportive regulatory environment are poised to accelerate innovation in digital assets.

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