Revolutionary Digital Asset Bill Introduced in South Korea

Rep. Min Byung-duk, a prominent member of the Democratic Party of Korea and chairman of the party’s Special Committee on Digital Assets, has unveiled the "Digital Asset Basic Law." This landmark legislation aims to redefine the digital asset landscape in South Korea, introducing a clear classification system and fostering a competitive environment for stablecoins and other digital assets.

Key Features of the Proposed Legislation

The bill categorizes digital assets into asset-linked digital assets (stablecoins) and general digital assets, each subject to different issuance requirements. Notably, the legislation removes barriers for various industries to enter the stablecoin market, allowing any domestic corporation with capital of 500 million won or more to issue stablecoins, without imposing qualification requirements on the issuing entities.

Global Competitiveness and Monetary Sovereignty

Prof. Kang Hyoung-goo of Hanyang University highlights the importance of this bill for South Korea's global competitiveness, especially in the face of giants like Apple Pay and PayPal. Rep. Min emphasizes the need to utilize South Korea's assets to issue won-based stablecoins, maintaining monetary sovereignty while fostering innovation.

ICOs and Regulatory Framework

The bill also addresses the long-standing industry demand for allowing Initial Coin Offerings (ICOs), introducing a regulatory framework that requires an issuance report to be submitted to the Financial Services Commission. This move is expected to eliminate the shadow regulations that have previously hindered ICOs in South Korea.

Establishment of New Regulatory Bodies

To oversee the digital asset market, the bill proposes the creation of the "Digital Asset Committee" and the "Korea Digital Asset Industry Association." These bodies aim to ensure fair practices and market surveillance, addressing previous conflicts of interest and inefficiencies in the existing regulatory framework.