South Korea’s new government, led by Yoon Suk-yeol, is moving quickly to implement key changes in the nation’s crypto industry. These changes will allow for the reintroduction of ICOs, which were abolished in 2017 due to the high incidence of fraud.
A New Crypto Asset Framework For North Korea
The new President’s Transition Committee is developing a cryptocurrency framework that would encourage the development of the country’s digital asset sector.
According to the Digital Asset Framework Act, the goal is to establish a climate that promotes responsible development on the basis of investors’ confidence. It will put in place measures to protect investors and work to enhance “transaction security,” which relates to the activities associated with issuing tokens, such as exchange and NFTs listings.
Fortunately, the plans also include the lifting of the restriction on domestic ICOs. As per the details, authorities would differentiate between ICOs that are ‘security’ and those that are ‘non-security.
Initial Coin Offerings
Initial coin offerings (ICOs) is a method for new cryptocurrency ventures to generate funds. However, they have been in existence since 2013. That was when Mastercoin was launched. It was until 2017 the public started to pay attention.
It wasn’t unusual for ICO investors to become millionaires overnight during that time when cryptocurrency values were soaring. Throughout this period of rapid growth, 800 ICOs were made, generating over $20 billion.
Unfortunately, since they were unlicensed securities, most of those ventures turned out to be frauds attempting to exploit the market’s frenzy. Most of the ICOs launched were used for fraudulent purposes defrauding several investors. The increased fraud cases called the attention of the then federal government, which restricted ICOs.
In 2017, ICOs were outlawed in China and South Korea due to increased fraud cases. Because of their tarnished image, various fundraising strategies, like Initial Securities Offerings, Initial Exchange offerings, and the initial stake pool offerings, have stepped. The good news is that the Digital Asset Framework Act will pave the way for the resurgence of ICOs.
The President Sticks To His Promise To Regulate The Crypto Sector
In March, the pro-crypto President, Yoon Suk-yeol of South Korea, won the country’s national election, narrowly defeating political opponent Lee Jae-Myung with less than one percent of the vote.
Yoon has previously said that he will put rules in place to legitimize the crypto business, including the abolition of the restriction on ICOs. However, with the President’s inauguration scheduled for the 10th of May, the crypto supporter isn’t wasting time putting things in motion.