The South Korean Ministry of SMEs and Startups announced plans to amend a law to formally recognize crypto firms as venture companies, aiming to stimulate innovation and investment in the sector.
Impact on the Crypto Market
The legislative change will allow virtual asset trading and brokerage services to register as venture companies, enhancing their access to government support and tax benefits. This may improve liquidity and reduce operational costs for crypto firms.
Historical Context and Current Situation
This legislative change restores venture status to Dunamu, the parent company of Upbit, after losing it in 2018, which had led to increased taxes for the company. This change could positively affect the crypto market in South Korea.
Prospects and Potential Changes
Although immediate market reactions remain muted, the legislative change is expected to bolster market legitimacy and attract investors and entrepreneurs to the digital asset sector. This could initiate significant shifts in the country's financial landscape.
Recognizing crypto firms as venture companies in South Korea could be an important step towards improving the investment climate and fostering sector growth.
