Will NFTs and crypto-currencies in general succeed in getting that South Korean presidential candidate who publicly displays his support for them elected?
NFTs in Korean elections
The Democratic Party will issue NFTs to fund the campaign of its candidate, Lee Jae-myung, for the South Korean presidency. The NFTs will be linked to images and promises of the candidate. They will be offered to people supporting Lee Jae-myung in return for their donations.
The head of the campaign, Kim Nam-kook, said in an interview with the media Yonhap News, that these NFTs will especially appeal to the younger generation:
“As the young generation of 20-30 years old is interested in emerging technologies, including virtual assets, NFTs and metaverse, this type of fundraising could appeal to them.”
In addition to this use of NFTs to fund the campaign, Lee Kwang-jae also announced that he would be accepting cryptocurrency donations in mid-January 2022.
In addition, he gave a positive speech about cryptocurrencies, encouraging “understanding of these future technologies” and urging to “change perceptions of digital currencies and NFTs.”
The Democratic Party candidate pointed out that policies and laws are failing to catch up with digital developments.
Fine promises for a political seat and the reality of regulation
In campaign season, the rhetoric comes and goes – and looks the same? – but voters should remember that promises only bind those who believe them. If elected, will Lee Kwang-jae actually work towards the development of cryptocurrencies in South Korea?
The recent news from South Korea is far from good. Korean regulators have pushed back against the exchange Coinone, which announced in late December 2021 that it would prohibit its users from withdrawing their crypto-currencies to external wallets without KYC – for Know your customer, the famous identity verification procedure in the name of fighting money laundering and terrorist financing. Major South Korean exchanges will likely follow this disturbing practice.
Korean regulators are also playing weathercock regarding cryptocurrency regulation, a lack of clarity in positions that is hurting the industry’s development. In November 2021, for example, the South Korean Financial Services Commission had announced that NFTs are not digital assets, and therefore will not be regulated.
However, the Commission changed its mind after only a few weeks, that NFTs will finally be taxed at 20% from January 1, 2022, a regulatory provision that nevertheless concerns digital assets with revenues exceeding 2.5 million won – about $2,100.
The Democratic Party finally succeeded in delaying the implementation of this law, pointing out loopholes in the measure.
If he wins the elections, Lee Kwang-jae will have to arbitrate between the development of the South Korean central bank’s digital currency, and the establishment of a favorable environment for crypto-currencies, two choices that until now seem mutually exclusive.
