South Koreaโs crypto scene will gain either way in the countryโs presidential elections, as both candidates have run on pro-crypto platforms, pledged to ease regulations and expand crypto access.
South Koreans will head to the polls on June 3 to elect a new president in a snap election to replace Yoon Suk-yeol, who was impeached and removed from office over his attempt to declare martial law in December.
Currently leading the polls is Lee Jae-myung of the center-left Democratic Party, who is up against staunch conservative and People Power Party nominee Kim Moon-soo.
Lee has proposed legalizing spot crypto exchange-traded funds and wants to allow South Koreaโs $884 billion national pension fund to invest in cryptocurrency.
He has also advocated for wider issuance of a stablecoin backed by the South Korean won as part of modernizing the countryโs financial system and stemming capital outflows.
โWe need to establish a won-backed stablecoin market to prevent national wealth from leaking overseas,โ he said during a policy discussion in May. โI will create a safe investment environment so that young people can build assets and plan for the future.โ
Lee also aims to ease strict banking rules that require crypto exchanges to partner with licensed banks to offer fiat services.
Kim also supports legalizing spot crypto ETFs and backed Leeโs proposal, showing rare bipartisan alignment. He has also pledged to ease regulations and expand crypto adoption.ย
Simon Seojoon Kim, the CEO of Seoul-based venture capital firm Hashed Ventures, told Bloomberg that with all the major candidates supporting pro-crypto policies, โthe countryโs crypto investors face a clear win regardless of the election outcome.โ
A Gallup Korea poll on May 28 showed 49% of respondents favoured Lee, while 36% said they would vote for Kim.ย
Urgency for clear regulations
The urgency for clear regulation stems from South Koreaโs high retail crypto participation. Stricter regulations were implemented in July 2024 to impose strict requirements on exchanges, including potential life sentences for criminal violations.
Related: Veteran capital in crypto is shaping South Koreaโs elections
On May 20, the countryโs Financial Services Commission finalized sweeping new measures, introducing new guidelines for nonprofit crypto sales and stricter listing standards for exchanges.
South Koreaโs Democratic Party also launched a Digital Asset Committee focused on developing cryptocurrency policies and promoting industry growth in May.ย
South Korea has one of the worldโs most active crypto markets, with over 18 million people, or more than a third of the population, involved in crypto, reported Bloomberg. Daily trading volumes on crypto exchanges sometimes exceed the countryโs major stock indexes, and user numbers recently surpassed 16 million.ย
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