It is hard to envisage the modern century without the role of magnates like Samsung and LG, which have established themselves as global brands in technology and consumer electronics. So much so that they have challenged to oust the likes of Apple and GE. This affirms the status of South Korea, which is the parent nation of these (among many others) moguls, as a major global force in technology.
Apart from conventional technologies, South Korea is also investing the most in high tech advancements of the future. Earlier this year, it revealed plans to invest $2 billion (2.2 trillion won) in artificial intelligence to contend with other AI leaders like the US and China. Now, it has shifted its majority focus toward blockchain technology and its versatile application.
The country has made significant strides in blockchain with the technology being all in rage over the past year. Its role as a major cryptocurrency market takes unanimous discretion from investors, traders and regulators alike. The top two crypto exchanges – Upbit and Bithumb are among the top 25 exchanges in the world and combine for a daily trading volume of over $200 million.
South Korea has also been looking beyond cryptocurrencies to other blockchain technology applications and is making a significant effort to establish a reputable status in that respect. The country has effectively reshaped its stance regarding crypto trading and other activities, placing itself in the pole position to become a global force in blockchain technology.
Here, we look at a few of South Korea’s distinct features and interests, which make it a hub for blockchain progress.
Positive stance on blockchain
Initially, the South Korean authorities had banned local ICOs, which served as a warning sign to its hostile reception of cryptocurrencies. They were also one of the first ones to issue severe regulations in crypto trading and prohibited citizens from anonymous trading. Government officials were also banned from holding and trading crypto assets.
However, this is a generally accepted notion that the ICO ban stimulated the particular development in blockchain technology in the country, especially in the private sector. This supposedly allowed smaller neighbors like Hong Kong and Singapore to become safe harbors of cryptos and blockchain. Out of this need to compete, the government has since then lifted the ban on ICOs and deemed that as a move to deter scam ICOs from originating and to protect the citizens from corrupt practices.
Now, Bitcoin enjoys a legal status as remittance source while exchanges are classified as financial institutions. Yet, new policies regarding blockchain and decentralized apps are expected to come out.
Block Seoul‘s Organizing Committee Chairperson, Jea Edman reports:
The South Korean government instituted the ban as a reaction to problems within the ecosystem, such as hacking and fraud allegations. However, the citizens of South Korea were already deeply invested in blockchain, contributing greatly to the global crypto market. If you look at Bitcoin alone, South Koreans are responsible for 14 percent of that market.
Attractive destination for blockchain community
South Korea has also established itself as a global destination for the blockchain community to gather and interact. Its capital, Seoul, recently hosted the Korea Blockchain Week, where events and communities from multiple international blockchain firms were present, making more than 2,000 attendees who came from over thirty countries.
Seoul is again set to host another major blockchain event in September. The participation of personalities like Wikipedia founder Jimmy Wales, former director of CIA, Michael Hayden, former New York State governor David Paterson, and former U.S. National Intelligence director James Clapper highlight the interest of established tech giants and traditional institutions in the technology.
Edman further tells:
The region is already in the midst of a building success in blockchain. Locally, almost half of the workforce is already investing in blockchain and more than 20 percent of all the crypto trading in the world is happening in South Korea. It’s no accident that we chose Seoul. We wanted to be at the center of current innovation and future thinking.
Amidst the recent great fluctuation observed in the crypto space, where the market has had its ups and downs, some countries have come up with hard line stances about cryptocurrencies. Regional neighbors like Gibraltar and Malta are highly supportive, compared to bigger nations like Pakistan and Nepal, who are less involved in research and application of blockchain. Moreover, greater economies like Japan and China also have recorded mix tenors about this space.
This has put South Korea in a key position to take advantage of the regional scarcity of research and development in cryptocurrencies and blockchain. It symbolizes itself as a forward thinking country, who does not question the potentially unfathomable usage of blockchain technology for the future.
To pin a final piece to these developments, South Korea’s main financial regulatory body, the Financial Services Commission announced a major restructuring to create a new bureau, dubbed as the Financial Innovation Bureau. It will be dedicated to providing stewardship and direction to the emerging financial technologies including blockchain and cryptocurrencies.
Moreover, the finance ministry has earmarked 5 trillion won for AI and blockchain development and announced of plans to allocate another 60 billion won over the next 5 years to fund “growth through innovation”.
Bright future ahead
The country’s pursuit to blockchain dominance at both private and state level is well on its way. While other countries struggle to understand the benefits of this digital transformation and fail to come up with definite stances about it, South Korea has constantly been active in digitizing various aspects of life.
Adding to the governmental support, private entities have also risen in numbers since the ICO ban has been lifted. There are numerous private ventures designated to research and development over blockchain’s application.
The country may well prove to be instrumental in bringing blockchain to the mainstream masses and take it towards general acceptance. Safe to say, this success will be truly home grown.