South Korea’s government, led by President Lee Jae-myung, advances legislation to legalize ICOs and tokenize securities, enhancing market legitimacy with new regulations, as announced in Seoul.
The reforms aim to attract institutional investors by clarifying crypto market regulation, potentially increasing active trader numbers and liquidity within South Korea’s crypto space.
South Korea’s legislature is advancing a major reform to legalize ICOs and tokenize securities through the Virtual Asset Basic Law. This initiative aims to elevate market legitimacy while fostering institutional participation under the leadership of President Lee Jae-myung. According to President Lee, “The crypto market reform is a five-year national strategic priority that will enhance regulatory clarity and market legitimacy.” – AINvest
The Financial Services Commission, led by Chairman Kim Joo-hyun, has been instrumental in accelerating crypto regulatory timelines. The new reforms focus on enabling the issuance and trading of tokenized securities in a regulated environment.
The legislation’s approval is expected to provide new funding opportunities for crypto ventures. Important affected tokens include Ethereum for tokenization projects and Bitcoin due to upcoming spot ETFs, which anticipate increased institutional interest.
Insights suggest these reforms could enhance market liquidity, as stablecoin licensing and ETF introductions are poised to unlock substantial investment flows. Historical data indicate that such frameworks attracted significant capital influx in comparable markets previously.
Reflecting back, South Korea had previously banned domestic ICOs, echoing China’s actions during 2017-2018. The collapse of Luna in 2022 prompted tougher regulations, which now evolve to support growth-oriented reforms with improved investor protections.
Experts from Kanalcoin foresee potential boosts in the DeFi sector, with regulatory certainty promoting new innovations in real-world asset tokenization. Analysis suggests a positive trajectory for market activities amidst these legislative advancements.
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