Talk about a turnaround! South Korea rocked the crypto world last year by announcing a ban on ICOs, along with sending some negative signals regarding trading of cryptocurrencies.
But it looks like the government has had a change of heart.
According to this report in Korea Times, the government could once again allow initial coin offerings, and is currently said to be preparing a policy plan. Basically, if the ban is lifted, it will open the door for Korean companies to raise funds using digital currencies.
An anonymous source revealed:
“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.”
This is the best way to go about it, some would say.
Last year the government announced a blanket ban on ICOs, saying that it could not regulate them, as it was not able to classify cryptocurrencies as money, currency or securities. The ban was not enforced, though, and South Korean remained eligible to invest in foreign ICOs.
Now, though, the government is putting together a framework that will set out tax, regulation and legal guidelines for the exchange market.
Once that is done, ICOs would start again.
Albeit with a condition that fundraising would only be possible on products that relate to advance blockchain related technology. In other words, the government would try to prevent speculating investments in other areas.
Still, even with all this, this is a refreshingly significant development.
And may well chart the direction for the future, for how companies raise funds in the future.
This potential new ICO policy follows other steps the South Korean government has taken to loosen the tight restrictions in place for trading Bitcoin and other cryptocurrencies. It is currently working on a formal licensing system to help regulate these virtual currency exchanges.
Which itself is a far cry from the talk that that they were used to launder money and evade taxes.