Lawmakers formally propose lifting South Korea’s ICO ban

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Members of South Korea’s National Assembly have made the official recommendation that the laws banning initial coin offerings (ICOs) should be lifted, according to reports.

The ban, which came into force just eight months ago, effectively outlawed ICOs in the country, following concerns over a lack of regulation and limited investor protection. However, according to Business Korea, proposals have been put forward that would see ICOs reintroduced, subject to new regulation and for domestic ICOs only.

The proposals originated with members of the Assembly’s special committee on the fourth industrial revolution, the committee personally chaired by President Moon Jae-in, which accused the government of “neglecting its duty” to foster the blockchain sector, in light of the current restrictions.

The National Assembly has now put forward the proposals for consideration by the South Korean government, specifically designed to remove the limitations and embrace ICOs within South Korea.

As one of the world’s most developed cryptocurrency markets, the decision to ban ICOs, coupled with a range of other measures directly targeting cryptocurrency investors, sent shockwaves through the cryptocurrency community in South Korea. Since then, some lawmakers, in addition to a range of other industry stakeholders, have been lobbying the government to reconsider.

The committee also recommended the government establish its own task force as soon as possible, to develop an effective policy response.

“The administration also needs to consider setting up a new committee and building governance systems at its level in a bid to systematically make blockchain policy and efficiently provide industrial support. We will also establish a legal basis for cryptocurrency trading, including permission of ICOs, through the National Assembly Standing Committee,” according to the committee.

The proposals first became public earlier this month, with Rep. Hong Eui-rak of the ruling Democratic Party announced he had begun drafting a bill to ease the ICO restrictions. At the time, he said the move would help bring essential clarity to the emerging blockchain sector there.

“The bill is aimed at legalizing ICOs under the government’s supervision…The primary goal (of the legislation) is helping remove uncertainties facing blockchain-related businesses,” Hong said.