Market News

South Korea Embraces Crypto Growth By Lifting VC Funding Ban

In a significant policy shift, South Korea has lifted its seven-year ban on venture capital (VC) funding for crypto-related companies.

Starting September 16, these firms can now seek investment opportunities, as reported by Seoul Kyungjae.

The decision follows an amendment to the Enforcement Decree of the Special Act on the Promotion of Venture Businesses, sanctioned by the State Council.

Previously, crypto trading and brokerage businesses were classified as "restricted venture businesses," a label imposed in 2018 to curb speculative trading.

This historical ban faced backlash from the crypto community, especially since only a few sectors like nightlife and gambling had similar funding restrictions.

The Ministry of SMEs and Startups emphasized that this change reflects the evolving status of the global cryptoasset industry and enhances user protection for domestic exchange users.

Fostering the digital asset ecosystem, the ministry aims to support technologically advanced crypto firms on par with other IT innovators.

SMEs Minister Han Seong-sook expressed a commitment to creating a transparent ecosystem and facilitating the influx of venture capital into the sector.

Additionally, the Executive Vice Chairman of the Digital Asset Exchange Association (DAXA) hailed this regulatory change as a potential turning point for South Korea’s crypto landscape.

With these developments, the South Korean government appears poised to support and nurture the growth of its burgeoning crypto industry.