South Korean FSC head nominee faces backlash after denouncing crypto

Lee Eok-won, the nominee to caput South Korea’s Financial Services Commission, drew dense criticism this week aft dismissing crypto arsenic lacking immoderate existent worth successful his written grounds up of confirmation hearings, section media reported connected Sept. 1.

Lee said integer assets bash not person intrinsic worthy successful the aforesaid mode arsenic equities oregon slope deposits, and argued that their terms swings undermine their quality to enactment arsenic money. He further stated that the utmost volatility experienced by integer assets makes them unsuitable arsenic a store of worth oregon arsenic a mean of exchange.

Lee’s presumption is accordant with the government’s presumption that integer assets are neither ineligible tender nor fiscal products nether the fiscal regulatory regime.

The FSC seat nominee warned against allowing status and pension funds to put successful the assemblage but expressed openness to regulating stablecoins, noting that they could beryllium managed with safeguards portion leaving country for innovation.

Industry pushback

The country’s blockchain assemblage rejected the remarks, with galore successful the manufacture arguing that the connection ignores the gross and adoption being generated crossed the industry.

Since 2022, crypto adoption successful South Korea has surged from astir 9.7 cardinal investors to much than 16 cardinal by aboriginal 2025, representing implicit 30% of the colonisation and increasing much than 60% successful conscionable implicit 2 years.

Trading enactment connected section exchanges has astatine times exceeded banal marketplace volumes, and full holdings person climbed supra 102 trillion KRW ($70 billion), highlighting however integer assets person rapidly go a mainstream concern prime for South Koreans.

An expert astatine Xangle, a section information firm, accused Lee of relying connected outdated arguments erstwhile communal among accepted concern leaders.

He pointed to caller token buybacks and gross streams from platforms similar Hyperliquid, Tron, and Ethena arsenic grounds of worth instauration comparable to firm banal buybacks.

Policy caution vs. retail demand

South Korean regulators person reinforced restrictions successful caller months arsenic retail involvement continues to ascent successful the country.

The Financial Supervisory Service advised home plus managers to standard backmost holdings successful crypto-related stocks, portion the FSC ordered exchanges to halt providing lending services backed by integer assets oregon fiat deposits.

Despite the tighter stance, retail enthusiasm for crypto continues to climb. Investors sold disconnected hundreds of millions of dollars’ worthy of Tesla banal successful August, the largest disposal since aboriginal past year, portion directing funds into crypto proxies similar BitMINE, which precocious became the biggest Ethereum holder.

Data besides showed a steep diminution successful South Korean purchases of large U.S. tech shares compared with earlier this year.

The contrasting positions betwixt regulators and investors permission unfastened questions astir however President Lee Jae-myung’s medication volition balance caution with the public’s increasing appetite for integer assets.

The station South Korean FSC caput nominee faces backlash aft denouncing crypto appeared archetypal connected CryptoSlate.