In South Korea, Promises Regarding The Crypto World Are Voiced Loudly.

The political parties in South Korea are offering various incentives for the cryptocurrency sector to attract the attention of voters as the general elections approach.

South Korea's major political parties are making various promises regarding the cryptocurrency sector to win voter support ahead of the upcoming general elections.

According to Bloomberg's report on April 5th, the opposition Democratic Party pledged to lift existing restrictions on exchange-traded funds (ETFs) investing directly in cryptocurrency tokens, including approved Bitcoin ETFs in the United States, both domestically and internationally. South Korea's securities regulator had previously warned that distributing such funds in local markets could violate local laws following the approval of Bitcoin ETFs.

Hwanseok Choi, a representative from the Democratic Party, stated in an interview with Bloomberg that they would allow ETFs, whether domestic or international, referring to their election manifesto.

Meanwhile, the ruling People Power Party, led by Yoon Suk Yeol, also promised to defer taxes on profits from digital assets, aiming to garner votes from voters.

Official data shows that approximately six million South Koreans engaged in cryptocurrency trading through registered exchanges in the first half of 2023, representing about 10% of the country's population. It's noted that cryptocurrency investors constitute about 7% of the total electorate.

Data provided by the Korea Securities Depository indicates that South Korean crypto users invested over $200 million in shares of MicroStrategy (MSTR), known for its Bitcoin investments. The company's significant exposure to Bitcoin has led some analysts to label it as essentially a leveraged Bitcoin ETF.

However, despite the promises made by politicians, South Koreans are preparing for stricter regulations on cryptocurrency assets. Local financial authorities are planning to announce new rules for token listings on central exchanges in the coming weeks. Among these rules are bans on listing hacked digital assets until the root cause is identified and listing foreign digital assets only if a white paper or technical guide is provided for local investors.

Furthermore, the Virtual Asset Users Protection Law, set to take effect on July 19, 2024, will prohibit the use of "undisclosed material information" related to cryptocurrency, market manipulation, and illegal trading. In February, the government issued an update with significant penalties and criminal sanctions for violations.