"True Experts Must Participate to Foster the Virtual Asset Industry" [Hankyung Koala]

Minseung Kim's ₿ficial

Hopes for the Next Administration

Overcoming the chaos of martial law and impeachment, the new government was finally inaugurated on June 4. I believe the new president will create the 'true Republic of Korea', backed by the support of the entire nation and the robust 171-seat majority party.

Until now, Korea's blockchain industry has remained stagnant since the government's declaration of a 'complete ban' in 2017. Meanwhile, major countries such as the United States, Europe, and Japan have rapidly advanced their blockchain and virtual asset industries under clear regulations and policies, positioning them as a pillar of national growth strategies. At this moment, it is truly opportune for the president, who has proven excellent administrative abilities as a mayor and governor, to begin organizing the new government with the promise to "make Korea a digital asset hub."

Now, the digital asset-related pledges outlined in the <From Now, the True Republic of Korea> (hereinafter "the policy booklet"), the policy platform of the 21st Presidential Election by the Democratic Party of Korea, must be practically implemented.

We will make Korea a digital asset hub (Policy booklet p.177)

I sincerely welcome the commitment to enact the Phase 2 Virtual Asset Act (business legislation) and to promote the industry at a national level. Though it's late, this work must start now. Previous measures such as the amendment to the Specific Financial Information Act (2021) and the Virtual Asset User Protection Act (2024) only focused on preventing money laundering and price manipulation at exchanges, without even providing the legal clarity necessary for the development of innovative services and products. The stance of "blockchain is okay, coins are not" has hindered market entry for large corporations and financial institutions, leading to a talent and corporate exodus overseas.

In contrast, the United States, just two days after President Trump's inauguration, officially declared an "American leadership in digital assets" by executive order. The Trump Administration rapidly improved regulations, resulting in global corporations such as BlackRock, PayPal, Visa, and Mastercard, along with major banks, accelerating the issuance of stablecoins and the integration of virtual assets. Japan's big three banks are also issuing stablecoins. In 2025, the United States, Europe, Singapore, and others are establishing clear regulations for the digital asset industry, accelerating its convergence with traditional finance.

We, too, must promptly enact business legislation, and the government must deliver a clear message of "full-scale fosterage and promotion of the virtual asset industry." This means the 8-year-old policy of a "total ban on coins" must be officially withdrawn.

Conditionally permitting the issuance of virtual assets guaranteed for safety, establishing stablecoin use strategies such as issuance and distribution of KRW stablecoins—along with the enactment of business legislation—will play a decisive role in revitalizing the domestic blockchain industry ecosystem.

Allowing the issuance, listing, and trading of spot ETFs backed by underlying assets such as Bitcoin will also be a turning point that can resolve chronic issues in our virtual asset market. For virtual asset ETFs, not only the participation of financial institutions is necessary, but also lawfully operated market makers and derivatives. All these were excluded by emergency measures in 2017. Our virtual asset market has sometimes grown to exceed the trading volumes of KOSDAQ and KOSPI, but since only individuals could participate, it was vulnerable to price distortions such as the "Kimchi Premium" and abnormal volatility. With ETF approval, if financial institutions can formally enter the market, and market makers and the derivatives market operate under regulation, our virtual asset market will become much healthier and more mature.

Simplifying regulation and enhancing the effectiveness of blockchain special zones can serve as transitional solutions before the business law takes effect. These special zones fill the gap until real-world regulation is established and shadow regulation is eliminated.

We will improve regulations and resolve conflicts to foster the startup ecosystem (Policy booklet p.139)

By nature, blockchain and virtual asset businesses are startups. Except for two exchanges classified as large corporations, all domestic firms involved in virtual assets are also startups. However, just because they are "coin-related," they become the target of all sorts of regulations, and once registered as virtual asset service providers (VASPs), they are even deprived of venture company certifications, suffering reverse discrimination.

In this context, the new administration's strengthened regulatory innovation control tower role and resolution of regulatory uncertainty—including redefining the purpose and scope of regulations for negative regulation adoption, clarifying regulatory content, ensuring effective regulatory enforcement, and providing enhanced regulatory monitoring—are truly timely. Many companies and developers have either quit, changed their fields, or left for overseas due to explicit or shadow regulations. Now, we must rationalize regulation and revive the domestic ecosystem so that talent and companies can return.

We will leap forward as an AI top 3 nation through the AI Transformation (AX) (Policy booklet p.102)

Blockchain and virtual assets are closely linked to artificial intelligence. Blockchain and virtual assets are already being used for sharing computing resources for AI training and for developing domain-specific training models. Recently, the convergence of "Agentic AI" and virtual assets has also drawn attention. AI agents are now directly using virtual assets, especially stablecoins, to conduct transactions, investments, and profit generation, and micro-payment models that pay AI agents per task are spreading.

Global enterprises are acting quickly. Coinbase has demonstrated stablecoin transactions between AI agents and proposed the x402 protocol to enable autonomous financial transactions by AI agents. PayPal introduced the "Financial OS," which automates e-commerce by having AI agents search for products, compare prices, make payments, and handle refunds on behalf of users, with their stablecoin PYUSD playing a key role.

Plans promoting industrial convergence, such as Manufacturing AI, must also consider linking virtual assets. The blockchain industry ecosystem and AI industry ecosystem will inevitably be interconnected, and AI agents will transact with virtual assets.

True Experts Must Participate

Once again, congratulations on the inauguration of the new president and administration. In closing, I'd like to make one earnest request: Until now, our virtual asset industry has been discussed and regulated mainly by experts on traditional finance, capital market regulations, anti-money laundering, and regulators and investigators. They regard the "differences" of virtual assets and blockchain as "defects." Therefore, they are not suited for fostering and promoting the virtual asset and blockchain industries. Even in the U.S., the Securities and Exchange Commission under the Biden administration arbitrarily defined virtual assets as securities and attempted sweeping regulation, but failed completely, which contributed to Trump's re-election.

Virtual assets and blockchain are, in themselves, new industries, the key catalysts for building startup ecosystems, and the essential tools and materials for the AI industry. Deciding how to support these areas at the national level for the public good must be the subject of discussion by experts in virtual assets and blockchain. Only experts with deep experience and knowledge of how virtual assets and blockchain, markets, technology, and industry operate should actively participate in fostering and promoting the industry, regulatory improvement, and business law discussions.

About Minseung Kim, Head of Korbit Research Center…

He is a founding member and current head of the Korbit Research Center. He explains complex events and concepts in the blockchain and virtual asset ecosystem in easy terms, helping people with differing viewpoints understand one another. His background includes blockchain project strategic planning and software development.

▶This article is an external guest column introduced for cryptocurrency newsletter subscribers to provide various perspectives and does not represent the position of The Korea Economic Daily.

Jomi Hyun, Reporter mwise@hankyung.com