Author: Zen, PANews
From a humble background to being elected president, Lee Jae-myung has become an inspirational figure for the Korean people. On June 4th, the Korean Election Management Commission announced the completion of vote counting for the 21st presidential election, with Lee Jae-myung winning with 49.42% of the votes. His vote count of 17.287 million is a record for presidential elections. Lee Jae-myung began his presidency on the same day, moving the presidential office back to the Blue House.
Notably, crypto asset policies became a hot topic among candidates in this Korean presidential election. To win votes from young people and the middle class, both Lee Jae-myung from the Democratic Party and Kim Moon-soo from the People's Power Party proposed progressive crypto asset policies.
In his policy commitment, Lee Jae-myung discussed virtual assets as part of a "fair economy". He stated that upon taking office, he would aim to make Korea a "digital asset center" and lay the groundwork for nurturing the virtual asset industry.
Regarding crypto assets, Lee Jae-myung has been proactively supportive. As early as 2022, he demonstrated a positive attitude towards crypto assets and was seen as attempting to attract young voters interested in cryptocurrencies. He became the world's first presidential candidate to raise campaign funds through Non-Fungible Token issuance.
Lee promised to actively support the digital asset ecosystem, including creative digital asset issuance, secure trading and storage, indirect investment, and risk diversification through insurance. He also indicated potential openness to lifting the Initial Token Offering (ICO) ban under proper regulatory frameworks.
Lee has proposed supporting virtual asset spot ETFs, establishing a comprehensive regulatory system, and supporting the issuance of Korean won-pegged stablecoins to prevent capital outflow.
In terms of institutional investment, Lee supports expanding public fund allocation to crypto assets, proposing that the National Pension Fund and other government institutions could invest in cryptocurrencies after meeting stability standards.
Regarding crypto exchanges, Lee aims to introduce a government-led regulatory mechanism, establishing a comprehensive monitoring system and potentially relaxing the current "1 exchange-1 bank" rule.
These policies suggest Lee's intention to create a more crypto-friendly environment in Korea, balancing innovation with regulatory oversight.
In terms of taxation, the Democratic Party, led by Lee Jae-myung, proposed gradually implementing crypto asset transaction tax while significantly raising the tax-deductible exemption amount. According to PANews, the Democratic Party plans to collect virtual asset income tax as scheduled in 2024, but will increase the personal transaction income deduction cap from the current 2.5 million won to 50 million won to alleviate tax burden pressure on ordinary investors, especially young people.
PANews pointed out that there is controversy within the party regarding the delay of crypto tax rates, but raising the tax exemption is a consensus. In contrast, the Yoon Suk-yeol government, which was in power in 2022, initially requested a 20% tax rate on virtual currency income (for amounts exceeding 2.5 million won annually) starting in 2023. Lee Jae-myung's approach essentially acknowledges the prevalence of crypto exchanges, reduces overly strict tax barriers, and provides more incentive space for the government while collecting taxes, helping the market develop healthily.
Conclusion
Lee Jae-myung's victory not only represents a transformation in South Korea's political landscape but also signals potential major changes in the country's crypto asset policy direction. From "embracing regulation" to "nurturing the industry", from institutional construction to capital market alignment, his "crypto new policy" is already taking shape.
Against the backdrop of multiple countries strengthening crypto currency compliance regulations, whether South Korea can achieve its "digital asset center" goal through this round of policy changes remains a matter of continued market attention.
