The Korea Times has recently reported that local financial authorities are planning to legalize ICO (Initial Coin Offering) soon. An anonymous source has told The Korean Times:
“The financial authorities have been talking to the country’s tax agency, justice ministry and other relevant government offices about a plan to allow ICOs in Korea when certain conditions are met”
What’s the reason behind ICOs legalization?
Few South Korean mainstream media outlets have revealed that “Kakao” is concentrating on assimilating cryptocurrencies for its 100 million users. Kakao is basically the largest internet firm of South Korea, and there’ve been many reports that it’s planning to integrate cryptocurrencies on its each and every application, which will let the users to utilize KakaoPay for both sending and receiving cryptocurrencies.
Kakao is also planning to conduct an ICO and issue its own token. However, it’s been also reported that due to the present regulations on local ICOs, Kakao is preparing to conduct its ICO outside of the country, South Korea. If ICO of Kakao is conducted somewhere else, it may lead to an extensive loss for the economy of South Korea, particularly in the Blockchain sector.
It’s expected that the government of South Korean is on its way to legalize ICOs in order to prevent the leading conglomerates of South Korea from leaving the country to conduct ICOs, as it might also have a bad impact on the cryptocurrency industry as well as local Blockchain sector.
Apprehension about ICO protection
Financial Services Commission chairman, Choi Jong-Ku has recently shown his concerns to the local ICOs, mentioning that high risks are involved for investors inside the crypto-market.
However, even with the concern of investor’s protection by the FSC, there are still many sources inside the government that explain how local financial authorities are trying to allow local ICOs by enabling strict AML (Anti-Money Laundering), KYC (Know Your Customer), and taxation policy for investors.
Is South Korea and U.S. SEC on the same line?
The government of South Korea is willing to let companies conduct ICOs on condition that the token sales are registered with the government, which is on the other hand similar to the stance of the U.S. SEC Securities and Exchange Commission.
At this time, the South Korean government is on the same line with the U.S. SEC and is ready to allow only those ICOs that are registered with local financial authorities. Kang Young-soo (FSC cryptocurrency trading policies director) has confirmed that there are rumours about the legalization of ICOs, as he stated:
“There are many speculating about the possibility of allowing ICOs. The FSC has acknowledged a third-party view regarding the issue, but there’s nothing that we can say officially at the moment.”