South Korea is Becoming a Cryptocurrency Powerhouse for Adoption and Blockchain Use Cases
No other nation has managed to earn and continue to carry as advanced a reputation as South Korea has gaining this reputation as a high-tech centre for its line of technology, e-sports, innovation as well as a broad range of consumer electronics, it's no real surprise that Cindicator, which published a report, highlighting the sort of future role that South Korea would have with regards to the prospect of longer term cryptocurrency adoption.
When taking into consideration the existing data that is available via market volumes on a number of cryptocurrency exchanges, as well as economic history, regulatory policies, along with broader trends in the crypto market. Cindicator has reached a number of unique conclusions about nation south of the 38th parallel.
This comes from all of the existing evidence put forward by the company. Also thanks to the reputation of South Korea, which boasts 50 million citizens, as well as having a firm reputation as one of the 15 major economies that played a significant role in cryptocurrency adoption at an early stage. Overall, this can be attributed to a range of contributing factors, including exchange infrastructure, a higher-than-average level of adoption, as well as the existing regulatory framework as well as policies oriented around taxation.
South Korea – A Population Gone Cryptocurrency Positive
If we were to take some of the worlds most cryptocurrency progressive / friendly countries in the world, we, unfortunately, don't get the opportunity to see the likes of South Korea on that league table. We often find it being beaten out by other nations like Singapore, Estonia, and Malta as a more recent addition.
While these nations are continuous additions to a strong upper league table, but South Korea has demonstrated a very firm appetite for high-tech as well as the world of cryptocurrency, especially when it comes to the population's overall opinions of them.
According to reports from the cryptocurrency market, the South Korean population is responsible for roughly 30 percent of total trading of crypto-assets worldwide. Additionally, up to 30 percent of all those workers that are earning a salary within South Korea own or, to some extent, take part in trading of cryptocurrencies of a particular kind.
For a relatively small country, it has a very interesting history in terms of its economy and growth. This economic dynamism has translated to an otherwise comparably advanced system of cryptocurrency exchanges and regulatory policy.
South Korean Crypto Exchanges – How They Work
The cryptocurrency exchange world when it comes to trading within the South Korean peninsula is relatively advanced when we take a look at exchanges such as Bithumb, which is one of the largest exchanges in the country. It continually ranks in the top spot over the last month when it comes to trading volume in US Dollars. This is according to information provided as of November 22nd.
Along with Bithumb, there are a large number of cryptocurrency exchanges that represent some of the most prominent globally. These include the likes of Korbit, Opbit and Coinone. If we were to combine the likes of Bithumb and Upbit, they would dominate the market overall with a commanding 86 percent.
In the confines of this report as well, there have been a large number of cases where just adding another altcoin to the market as a new listing on a South Korean market would be enough to send the token rising significantly. An example of this includes the announcement by Bithumb of the cryptocurrency TRON (TRX) on April 2018. Within a matter of hours, TRX saw its value nearly double in 3 hours.
The Cindicator report states:
“There is no doubt that Korean exchanges are a key element in trying to analyze the crypto phenomenon in the Asian.”
The Vanguards of Mass Adoption – Prominent Crypto Projects
There are a number of cryptocurrency / blockchain-based projects that promise to bring about mass adoption across the world. And one of the most prominent comes from Coinone. Their project in question would involve a payment service which would be set up in collaboration with Qoo10. On its own, Qoo10 has gained a strong reputation in the Asian continent as a take on Amazon.
Along with Qoo10, there are a significant number of other businesses that intend to make extensive use of blockchain technology. These also involve various acceleration projects such as Deblock.
Regulation is Coming Forward Too
The South Korean government has been beleaguered by a number of fraudulent projects and ponzi schemes when it comes to cryptocurrency trading.
The underlying issue with Ponzi schemes is also in conjunction with a far higher level of trading which has since captured the attention of regulatory organisations, which has resulted in their push to lead a firmer stance on the cryptocurrency market.
As of September 2017, and through to March of this year, a large number of Initial Coin Offerings, as well as the anonymous trading activities involved in cryptocurrencies, were officially banned.
These very same imposed restrictions resulted in a large number of blockchain relevant subsidiary companies and corresponding initiatives moving out of South Korea in order to set up in nations such as Singapore in order to fully launch Initial Coin Offerings. But cost still presented an issue that prevented startups from getting involved.
The wider push by the South Korean government to regulate cryptocurrencies has begun to thaw for companies. And while it seems to have been a reaction to an earlier address to the consistent issues within the ecosystem at large. These would include Initial Coin Offerings and data breaches that were caused within crypto exchanges.
One of the pushes that the Korean government made in an announcement this year was the proposal to spend approximately 880 million dollars on further development within blockchain technology. Over 2019, this application of funding for development is part of a wider 5 trillion won package in order to innovate and stimulate the South Korean economy.
The initiative is a pretty profound indicator that the government is changing course in terms of its initial position, creating a far more optimistic landscape for blockchain technology application and the legitimization of cryptocurrencies overall.
As any member of the public within the country, South Korea has an infamously high level of tax for its people. Since 2013 however, Bitcoin, among many other cryptos are not placed under capital gains tax as other nations are.
This is very good for cryptocurrency traders and investors, allowing them to keep the entirety of their profits from trading and investing. This also allows for these same traders to undergo crypto tax with a far greater level of simplicity.
While there's no concrete stance taken on whether or not this 0 percent capital gains tax line will be taken, there's a general feeling that this is a state of affairs will be coming to an end in the very near future.
Simon Keusen, who works as the individual in charge of analytics for the firm, Cindicator, stated that as their research demonstrates that the influence that South Korea enjoys within the blockchain industry worldwide will continue to grow over time.
“The country is very open to new technology. The enthusiasm for crypto assets is palpable. Latest legislative initiatives show that the government understands the potential of blockchain technology.”
Keusen went on to reason that:
“South Korea will play an important role in driving the adoption of cryptocurrencies globally.”