South Korean Government is going to announce industrial classification system that fragments blockchain-related industries on the 25th. As G20 decided to recognize cryptocurrency as virtual asset, South Korean Government also decided to categorize cryptocurrency exchange as well as electronic currency as separate industries. It is interesting to see whether this decision will be a signal for relevant fields to be incorporated into formal sector.
According to South Korean Government and industries, Statistics Korea is going to officially announce ‘blockchain technology industrial classification’ system on the 25th.
This system fragments blockchain-related industries into 10 different industries. It is expected that position of blockchain businesses that were either not recognized as formal industries or combined as separate industries will be raised.
However, South Korean Government is not going to formally announce that cryptocurrency will be seen as virtual asset as there is small difference in stance between government departments.
Previously, Ministry of Science and ICT announced its strategy to develop blockchain technology. It also selected future projects with government departments such as National Election Committee, Ministry of Land, Infrastructure, and Transport, Korea Customs Service, Ministry of Agriculture, Food and Rural Affairs, Ministry of Foreign Affairs, and Ministry of Oceans and Fisheries.
As a follow-up measure, Statistics Korea has fragmented and supplemented blockchain technology-related industries based on Korea Standards Industrial Classification.
Possibility of recognizing cryptocurrency as virtual asset has gotten higher as Statistics Korea is going to practically recognize cryptocurrency exchanges’ legal position during its announcement.
Statistics Korea included software developers and suppliers and various information service providers from ICT sector, which are fundamental industries that form blockchain industry ecosystem, to the classification system. It also added network, protocol, operating system, and DApp (Decentralized Application) software developers and suppliers. However, it excluded legal consulting service providers, education and training service providers, and investment support service providers from the classification system.
Reason why this classification system is drawing so much attention is because south Korean Government has included ‘encrypted asset trader and broking agency’ to the classification system.
This is the first time when South Korean Government is recognizing cryptocurrency exchange, which was seen as a breeding ground for speculation, as blockchain business and stipulating a word ‘encrypted asset’.
Statistics Korea has classified cryptocurrency exchange as a mediator that stores, manages, and exchanges encrypted assets. In the past, South Korean Government did not provide any definition on cryptocurrency.
Meanwhile, an internal report from a G20 meeting that practically recognizes cryptocurrency as virtual asset was made public and has caused so much impact.
Many countries announced that they will acknowledge cryptocurrency as asset and that they will make separate guideline for regulations. Actually, many G20 countries agreed on establishing ‘standardized rule for virtual asset’. This indicates that cryptocurrency will be handled by respective governments from now on. It is expected that they will set up mutual-assistance systems for establishing protective measures for consumers. If South Korea does not participate in establishment of these regulations, it will be difficult for them to work with advanced countries and it will be isolated from them.
Due to this global trend, South Korean Government announced industrial classification system that practically acknowledges cryptocurrency as virtual asset.
However, South Korean Government is being careful with acknowledging cryptocurrency as virtual asset.
“Reason why we classified encrypted asset traders and mediators is because we could not leave out encrypted asset from blockchain technology.” said a representative for Statistics Korea. “Even G20 meeting used a neutral expression ‘encrypted asset’ and we have included cryptocurrency to classification system as a result.”
Financial authorities are showing similar stance.
“Financial authorities also participated in discussions for industrial classification system of blockchain technology.” said a representative for Financial Services Commission’s Virtual Currency Response Team. “Just because cryptocurrency exchange is included into classification system, it does not mean that it now holds legal position or is integrated into formal sector.”
Staff Reporter Gil, Jaeshik | osolgil@etnews.com & Staff Reporter Yoo, Seonil | ysi@etnews.com
