Conservative Yoon Suk-Yeol becomes South Korea’s new president. He is open to Bitcoin and other cryptocurrencies – for example by reducing the tax allowance for crypto profits and wanting to relax regulation.
South Korea is an important country on the global cryptocurrency map. The country is home to numerous exchanges, and from what is heard, many Chinese traders fled to them after China banned bitcoin trading.
The so-called Kimchi Premium – or the Kimchi Discount – in crypto slang describes the price differences on the exchanges in South Korea and the USA. These are probably driven by the country’s high interest in cryptocurrencies and the speculation of its residents. Speculative parts of the crypto market in particular – such as ICOs, tokens and NFTs – are said to be extremely popular in South Korea.
South Korea is also exciting for Bitcoiners because the old government pushed ahead with regulation. For example, it implemented the FATF Travel Rule in an extremely strict manner that severely discriminates against private wallets. Exchanges should not be allowed to make withdrawals to private wallets. The strict regulation had already wiped out almost 70 crypto exchanges and led to the widespread delisting of so-called privacy coins such as Monero or Zcash .
Yoon Suk-Yeol knew how to use this mood in the election campaign . The conservative politician stood up for free trade and economic liberalization, among other things. He used the topic of cryptocurrencies and assets to specifically address the young, technology-loving generation.
For example, he published an NFT collection of himself, which consisted of pictures and videos. In a virtual forum, he vowed to relax the crypto industry’s strict regulation: “In order to unlock the unlimited potential of the virtual asset market, we must shed regulation, which is unreasonable and unrealistic.” He vowed, through more realistic policies Attracting “unicorns” – crypto startups with a market valuation of more than $1 billion.
In addition, he promised to increase the tax allowance for crypto profits from 2.5 to 42.4 million won, equivalent to about 2,000 and $42,000 respectively. From 2023, a 20 percent tax on profits made through the purchase and sale of cryptocurrencies is to apply.
Interestingly, Yoon wasn’t the only candidate who posed as crypto-friendly to woo South Korea’s youth. His competitor, Lee Jae-myung, from the previously governing Liberal Party, who was only just inferior, also promised to relax the existing regulations. However, he focused primarily on the use of cryptocurrencies or tokens in games and in the metaverse, such as through NFTs, while largely ignoring the aspect of currency and speculation. Like his competitor, he also had an NFT collection out.
As in the US and South America, in South Korea the younger generations – Millennials and Gen Z – are likely to have a keen interest in cryptocurrencies . In South Korea, it also seems that young people are currently finding it difficult to maintain their wealth, which could also be a reason for the crypto enthusiasm.
Of course, the now elected Yoon will not make South Korea a crypto nation overnight. “As described by the Criptonizando portal”. But the industry can at least hope for some relief in regulation from him. Additionally, Yoon joins an emerging class of crypto-friendly politicians found from Ukraine to several states and cities in the US to Bitcoin President Nayib Bukele in El Salvador.