South Korea’s Ministry of SMEs and Startups has proposed a significant revision to existing legislation that could reshape the nation’s crypto sector. The proposal seeks to allow crypto firms to register as venture companies. This would enable them to access government subsidies, tax incentives, and financial support.
This move signals a broader shift toward fostering innovation in the digital asset sector under the administration of pro-crypto President Lee Jae-Myung.
South Korea Proposes Legal Changes to Support Crypto Firms
In the official notice released today, the ministry proposed to amend a specific South Korean law, the Enforcement Decree of the Special Act on Promoting Venture Businesses. This legislation provides several benefits to venture capital firms.
These include government-backed matching funds, tax incentives, loan guarantees, subsidies, and support for investments in designated venture clusters.
However, under the current regulation, virtual asset businesses such as cryptocurrency trading and brokerage are considered restricted. This restriction means that:
New businesses cannot apply for venture business status if they were involved in virtual assets.
Existing venture businesses that want to register as virtual asset operators would face revocation of their venture business certification.
The ministry now seeks to remove virtual asset-related sectors from the restricted industries list. This change comes in light of the increased awareness of the industry and the establishment of legal and institutional frameworks, such as the Virtual Asset User Protection Act, which aims to safeguard users.
The proposal intends to promote industry growth, ensure policy consistency, and foster innovation within the sector.
“Virtual asset businesses with innovative and entrepreneurial qualities, based on new technologies, will be newly recognized as venture businesses. Existing venture businesses will be able to pursue virtual asset-related businesses, which is expected to activate the venture ecosystem and expand its foundation. This is believed to promote the growth of the virtual asset industry,” the notice reads.
The ministry is now seeking public opinions on the proposed changes. Institutions, organizations, and individuals can submit their views online or in written form by August 18, 2025.
The development comes amid a growing crypto push in the country under a favorable regulatory environment. President Lee has made several pro-crypto commitments. One of his campaign promises was to implement a two-phase framework for crypto assets.
He also pledged to relax regulations to foster private sector-driven real-world applications. Furthermore, Lee has committed to introducing spot Bitcoin ETFs and issuing a Korean won-pegged stablecoin.
In line with this, BeInCrypto previously reported that eight South Korean banks are collaborating to launch a joint stablecoin. These efforts signal a promising future for crypto in the country. This could position South Korea as a leader in global crypto innovation and foster sustainable growth in the sector.
