ICO Ban In South Korea Remains

Dawid Paluch
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Choi JongKu, the Chairman of the Financial Services Commission (FSC), told legislators on Thursday that ban for Initial Coin Offering (ICO) still stands.

South Korea just keeps on giving. The Asian country is on fire these days. After Seoul’s Smart City plan and pressing charges against Cashierest, we have news about an ICO’s regulation.

No means no

FSC is a Korean financial supervisory structure. The commission was established in 2008. The FSC has important goals: preserving financial market stability, enforcing fair market practices, protecting financial consumers and advancing the financial industry.

The commission issued a ban on all ICOs in September 2017. According to an official statement, the purpose of the ban was to protect investors from fraud.

There were reports in local papers on a possible change of the course. A few days ago, CCN wrote a story on coming closer to legislation.

Choi JongKu met with the lawmakers at an annual government audit in the parliament. The chairman stated that his organization will stick to its rules regarding ICOs for now. He said:

Although many people call for the government to allow initial coin offerings, there are still uncertainties related to such a move as well as the possibility of serious fallouts”.

JongKu thinks that ICOs have a lot of problems to solve. Despite constant pressure from crypto industry, the regulator will continue with the current policy. For now, there won’t be any law regulations concerning the initial coin offering. So, nothing changes.

Trouble in the paradise

South Korea wants to be a leader in the blockchain. The government does a lot to achieve that goal. However, banning an ICO for Startups could suppress the development of a new technology.

New companies have to conduct ICOs in other countries like Singapore or Hong Kong. There have been many examples of Korean firms choosing exactly that way.

Kakao, an Asian mobile messaging giant, develops many new things based on the blockchain technology. One of them is Klaytn, a new platform for beginners in cryptocurrency. Even the Korean tycoon has problems with its ICO, though. Kakao has to push through the process in foreign countries.

That approach from the government can cause withdrawals of many new startups.

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