South Korea’s Hard Stance on Cryptocurrency

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As of last week, South Korean government officials began to attempt to ban initial coin offerings or ICOs. The government came out with a statement that they would begin “prohibition on all forms of ICOs.” Although they have not initiated the ban, their stance is just the beginning of many countries fighting against cryptocurrency. Several start-ups in the country that use the technology are trying to fight back.

Several leaders in the industry have stated that their is no legal methodology behind banning initial coin offerings or ICOs. One article stated that “local crypto industry leaders argue that the ban is legally groundless. They fear overregulation will push local talent and currency to more welcoming jurisdiction like Switzerland, Singapore and Japan.”

Using ICOs as a tool to raise money has been increasingly popular over the past year. Not only is it an effective way to raise capital, but using ICOs has become a very solid way to get a company’s name out into the world. One article claimed that “to ban ICOs as a fundraising tool was made as the government sees such issues as increasing the risk of financial scams.” There may be a good amount of scams out there using the technology, but the number of legitimate companies using ICOs to raise capital for their causes far outweighs those few.

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Several members of the South Korean community have been shocked by the governments hard-handed response to cryptocurrency and their negative attitude as a whole. The CEO of Bitcoin Center Korea, John Ra stated that “we were expecting this kind of announcement, but we were surprised they used the words ‘total ban’.”

The world of cryptocurrency has seen a large amount of controversy over the past year and it only seems like it is increasing. With new technology being adopted, there will always be skepticism, but in the long run, it is worth it.

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