South Korea ICO regulation has become a hot topic. The government reportedly plans to tax ICOs and cryptocurrency transactions. This move comes despite the absence of a formal regulatory framework in the country. It highlights the authorities’ intent to control and benefit from the growing crypto market before comprehensive legislation is established.

The Korea Times reported that Finance Minister nominee Hong Nam-Ki disclosed these plans. He responded to a question in the South Korean National Assembly about the taxation of virtual assets. Nam-Ki submitted his answer in written form.

He also stated that the tax system for cryptocurrencies would be developed in line with global taxation standards. Nam-Ki said, “A task force of experts from government agencies, including the National Tax Service and the private sector, will study overseas examples and create the taxation plan.”

Considering the current ban on ICOs in the country, Nam-Ki said the government will study various factors before deciding its stance on ICOs. These factors include global trends, market conditions, and investor protection.

South Korea’s cautious ICO regulation stance

Furthermore, the nominee stated that the government would form its position on ICOs based on a survey by the financial regulatory market and experts.

Regarding digital currencies, Nam-Ki called them “a phenomenon with no generally accepted regulatory structure.” He added that the industry, with 2,000 cryptocurrencies traded globally and 160 in South Korea, should be regulated carefully.

The Finance Minister nominee also assured that the government would “nurture blockchain technology.” He said about 90 percent of businesses can be classified as blockchain-related. Besides digital currency exchanges, these include many venture companies.

So far, the South Korean government has not introduced a standard regulatory framework for its cryptocurrency industry. In the second quarter of 2018, it announced plans to regulate cryptocurrency exchanges. However, less than a week later, the regulations were postponed without explanation.

In conclusion

South Korea ICO regulation is attracting attention as the government is currently planning to tax ICOs and cryptocurrency, despite the absence of a formal regulatory framework in the country. This development was disclosed by the country’s Finance Minister nominee, Hong Nam-Ki, during his appearance before the South Korean National Assembly, signaling a move toward tighter fiscal oversight of the crypto sector even before specific laws are enacted.

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