At the start of this month, South Korea’s main financial watchdog hinted it was contemplating fresh measures that would empower institutional players to manage digital assets. Industry stakeholders applauded the possibility, viewing it as a boost for market liquidity and a step toward wider acceptance. However, the Financial Services Commission (FSC) has backtracked, clarifying that it requires additional time to weigh the ripple effects of such a choice.
During a recent assembly of the FSC’s Virtual Asset Committee—charged with mapping out annual objectives—The Korea Times reported that the topic of corporate accounts did not make it onto the docket. The newspaper noted the committee deemed a “more detailed examination” essential before moving ahead.
Chaired by FSC Vice Chairman Kim So-young, the committee comprises industry specialists and government personnel from pertinent departments. Even so, despite the deferral, many anticipate the FSC will press on later in the year, ultimately lowering hurdles for business entities aiming to engage in digital asset transactions.
“The matter of permitting corporate accounts, which we have previously explored, has been rigorously analyzed through 12 subcommittees and task forces. The evaluation process is almost complete. We will share the findings soon and promptly initiate the next steps,” Kim announced.
Beyond fueling capital flow and normalizing digital currencies, letting corporations enter the crypto arena would broaden the country’s digital payment spectrum. While South Korea ranks among the biggest hubs for virtual assets globally—where 30% of residents have invested in digital holdings—most of this activity revolves around speculative trading. Bitcoin’s original goal of enabling frictionless payments has largely fallen by the wayside.
Although the committee provided no fresh direction regarding corporate participation, it pivoted to consumer safeguards, concentrating on a new statute that took effect last July. The law’s first phase targeted investor protection, ensuring deposit security, and clamping down on illegal marketplace behaviors.
Kim revealed that the committee has now shifted its attention to implementing the legislation’s second phase.
“We need an extensive and coordinated strategy that encompasses businesses, marketplaces, and consumers,” he said.
He further mentioned that the panel is examining stablecoins, a topic of intensifying scrutiny worldwide. In the European Union, the Markets in Crypto-Assets (MiCA) framework has tightened oversight on stablecoin providers, compelling some—such as Tether—to consider scaling back after failing to secure the requisite license. Elsewhere, jurisdictions from Hong Kong to Cambodia have similarly enacted standards to regulate this sector.
Domestic crypto exchanges in South Korea are already feeling the pinch of the tightened regulatory climate. The country’s foremost platform, Upbit, may face sanctions and monetary penalties over suspected Know Your Customer (KYC) shortfalls. A disciplinary session with the FSC’s Financial Intelligence Unit is slated for Tuesday, January 21.
Thailand Eyes Digital Payments for Tourists
Meanwhile, in another corner of Asia, the Thai government aims to introduce digital asset payments later this year in a prominent tourist hotspot.
Deputy Prime Minister Pichai Chunhavajira recently laid out plans to pioneer crypto transactions in Phuket, an island province in southern Thailand that saw 4.3 million visitors during the first half of 2024. Chunhavajira, who also serves as finance minister, explained that digital asset payments would spare foreign travelers from navigating traditional currency exchanges for local goods and services.
Visitors will need to use exchange-based KYC methods to confirm their identities before they can pay with digital assets. The deployment will be more effective since, as the deputy prime minister pointed out, these transactions are covered by existing laws and won’t require any new ones.
Crypto has won significant traction in Thailand. Chainalysis reported that about 18% of Thai citizens owned digital assets in 2023, placing Thailand 10th in global adoption for that year.
Chunhavajira believes allowing crypto payments will simplify the process for foreigners looking to invest or settle in the country.
“Consider individuals who fled the Russia-Ukraine conflict and settled in Phuket. Amassing 50 million baht to buy a property can be cumbersome, but paying with BTC might be far simpler,” he remarked.
While the concept is promising, it hinges on deploying digital assets with low fees and quick confirmations—features that Bitcoin SV (BSV) offers. By contrast, BTC’s high costs, limited block size, and sluggish confirmations undermine its suitability for everyday purchases.
Beyond everyday spending, Thailand also hopes to follow the United States in approving a spot BTC exchange-traded fund (ETF). Securities and Exchange Commission (SEC) Secretary-General Pornanong Budsaratragoon stressed the importance of keeping pace with other financial powerhouses in the region, such as Singapore and Hong Kong, which are pursuing parallel strategies.
“Whether we like it or not, more people around the world are adopting cryptocurrencies. We must adjust and ensure investors have additional crypto options under proper regulation,” she commented.