Resignation of Crypto Regulation Proponent Fuels Hopes for Softer Rules

Kim Yong-beom's resignation as presidential policy chief has sparked hope for softer crypto regulation in South Korea. The country's cryptocurrency industry had strongly opposed Kim's plan to cap major exchange shareholders' equity at 20 percent, which would have forced founders to sell their excess stakes.

The Financial Services Commission still aims to finalize the Digital Asset Basic Act this month, but the timeline could slip until a new policy chief is appointed. Instead of an equity cap, compromise measures are gaining traction that would limit voting rights rather than require major shareholders to sell their stakes.

Under the proposed compromise, major shareholders could retain their stakes while having limited voting rights to 20 percent in principle. However, there's an exception that could allow up to 34 percent under specific regulatory conditions.