An expert has warned that a crypto “killer app” could soon emerge overseas and “suck up South Korean wealth.”
The comments came from Kim Min-seung, the head of the Research Center at the domestic crypto exchange Korbit, the media outlet Hanguk Kyungjae reported.
Kim Min-seung and others reportedly cautioned that the Korean government’s “closed” approach to crypto regulation could “ultimately lead to an outflow of national wealth.”
Crypto ‘Killer App’ – A Danger for South Korea?
The Korbit research chief noted that previous “killer apps” have already drawn funds out of South Korea.
“With the US government relaxing regulations [in the tech sector], there is a high possibility that a crypto killer app – one that will be used as a platform by people all over the world – will emerge soon.”
Kim Min-seung, head of the Korbit Research Center
Kim Min-seung explained that “Facebook and Instagram” successfully “sucked up domestic advertising” when they arrived on the South Korean market.
But, the researcher cautioned, a “crypto killer app” would instead “suck up South Korea’s wealth.”
Kim Min-seung was speaking at crypto investment-themed forum on March 25 in Yeouido, Seoul.
The Yeouido District of Seoul, South Korea. (Source: S h y numis [CC BY 4.0])
International Experts Weigh In
Other domestic and international crypto experts were also in attendance. Thse included Rahul Advani, Ripple’s Head of Public Policy for the Asia Pacific region.
Advani opined that South Korea should “focus on developing a strong custody system in line with international standards, while ensuring financial stability and investor protection.”
He called the regulatory Financial Services Commission’s recent unveiling of a “roadmap” that will “gradually allow institutional players” to access the crypto market a “step in the right direction.”
However, Advani added that crypto custody had become one of the most “important areas of regulation” as “institutional adoption” rises.
He added that “safe and properly regulated custody solutions” would be “the foundation for the development” of the crypto “market.”
There were further words of warning from top domestic experts, including Kim Yong-beom, the CEO of Hashed Open Research. The CEO explained:
“The [the United States] is already changing, creating, and leading the way in crafting rules [for the crypto sector]. But South Korea is a long way behind.”
Experts ‘Agree’ On the Need for Action: Crypto Killer App Nears?
The media outlet noted that “all” the forum’s speakers “pointed out that the South Korean government’s [stance on] crypto [regulation] falls short of the global level.”
They noted that United States government “views cryptoassets like Bitcoin (BTC) and stablecoins as a means to secure the continuation of the dollar hegemony.”
As such, Hanguk Kyunjae wrote, the experts agreed that Washington “is actively accepting” BTC and USD-pegged coins” into its financial system.
South Korea, however, only “sees them only as targets of regulation.” Kim Yong-beom concluded:
“Since the US approved Bitcoin spot exchange-traded funds (ETFs) last year, the size of Bitcoin ETF assets under management in the global market has grown faster than any other asset class in [history]. In the United States, the debate over whether cryptoassets can be considered as financial assets has already ended. But in South Korea, no Bitcoin spot ETF has ever been approved.”
BlackRock: Pay Attention to Institutional Investors
Robert Michnick, BlackRock’s head of digital assets, was also in attendance. He told forum-goers:
“This year will be an important year for major investment institutions. They will be deciding whether to include Bitcoin in their asset portfolios.”
Michnick added that the Bitcoin stockpiling plans “discussed at the federal government level in the United States” were now “spreading to state governments.”
He also claimed that it was important to pay attention to “how actively institutional investors are starting to treating Bitcoin as a [financial] asset.”
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