"U.S. Drives Crypto Asset Promotion... Urgent Need for 'Phase 2 Legislation' in Korea"

'National Assembly Forum for Enacting the Basic Law on Digital Assets'

Hosted by Kang Jun-hyun, Member of the Democratic Party of Korea

"It's Time for Korea to Enact the Basic Law on Digital Assets"

"Allowing Corporate Accounts is Positive for Both Investors and Businesses"

Kang Jun-hyun, a member of the Democratic Party of Korea, speaks at the 'National Assembly Forum for Enacting the Basic Law on Digital Assets' held at the National Assembly on the 6th. /Photo=Jin Wook, Bloomingbit Reporter

Donald Trump, the President of the United States, has expressed his intention to make the cryptocurrency industry a key growth engine for the nation. It's time for Korea to enact the Basic Law on Digital Assets."

Kang Jun-hyun, a member of the Democratic Party of Korea, stated this at the 'National Assembly Forum for Enacting the Basic Law on Digital Assets' held on the 6th.

In his congratulatory speech, Kang said, "The domestic cryptocurrency market's size reaches about 110 trillion won in market capitalization, with 8 million users," adding, "However, there are still unfair trading practices, and there are limitations in preventing and remedying user damages."

"U.S. Speeds Up Legislation on Cryptocurrency... Rapid Legislation Needed Domestically as Well"

The presentation that followed explained the current state of the U.S. cryptocurrency industry and the related objectives of the U.S.

Kim Gap-rae, head of the Capital Market Research Institute, said, "Both the Biden and Trump administrations share the common goal of maintaining dollar hegemony," but noted, "However, the Trump administration has chosen a more daring strategy. The Trump administration is actively utilizing blockchain-based payment networks to strengthen dollar hegemony."

He explained that the expansion of the dollar-based stablecoin (a cryptocurrency linked to the value of fiat currency) market and the strategic reserve of Bitcoin are also part of the Trump administration's strategy to strengthen dollar hegemony. Kim stated, "The larger the dollar-based stablecoin market grows, the more naturally the dollar's hegemony is strengthened," adding, "The U.S. introduced a stablecoin bill at the federal level on the 4th and is trying to grow it."

He continued, "The strategic reserve of Bitcoin is also being rapidly legislated at both the state and federal levels. It is almost certain that the U.S. intends to reserve Bitcoin," explaining, "The importance of phase 2 legislation is growing in terms of international competitiveness to prevent our market from being eroded."

"Allowing Corporate Accounts is Positive for Both Investors and Businesses"

The 'National Assembly Forum for Enacting the Basic Law on Digital Assets' was held in the 9th conference room of the National Assembly in Yeouido on the 6th. /Photo=Jin Wook, Bloomingbit Reporter

Meanwhile, the biggest problem in the domestic cryptocurrency market is cited as the inability of corporate investors to enter.

Lee Jong-seop, a professor at Seoul National University's Business School, diagnosed that the abnormal structure of the Korean cryptocurrency market, which is almost entirely made up of individual investors, needs to be resolved. Professor Lee said, "When thinking of the domestic cryptocurrency market, most think of centralized exchanges (CEX)," adding, "While the domestic cryptocurrency market is centered on individual investors aiming for high volatility, in the U.S., institutions and corporations are already entering the stage of asset liquidity through blockchain ledgers."

Hwang Hyun-il, a lawyer at Seyong Law Firm, also said, "The best way to increase market efficiency is through the participation of corporate investors," adding, "If the participation of corporate investors increases market efficiency, it can eventually prevent unfair cryptocurrency trading." He continued, "There are many cases in the fintech industry where institutional investors have filtered out fraudulent products," adding that the participation of corporate investors can prevent damages to individual investors.

Hong Seong-wook, a researcher at NH Investment & Securities, also said, "Currently, when domestic companies receive investments in cryptocurrency or pay transaction fees, it is difficult to cash out," predicting, "If corporate accounts are allowed, more attractive cryptocurrency businesses will emerge in the long term."

Regulatory authorities also recognize the necessity and have stated that they will diligently review it. Kim Seong-jin, head of the Virtual Asset Division at the Financial Services Commission, said, "The government is also expediting discussions on the related regulatory framework. There was a related discussion at the Virtual Asset Committee on January 15th," adding, "Measures to mitigate disclosure issues and side effects following the allowance of corporate accounts are needed," and "Currently, discussions are underway through a practical task force (TF)."

Son Min, Bloomingbit Reporter sonmin@bloomingbit.io

Jin Wook, Bloomingbit Reporter wook9629@bloomingbit.io