The transfer would give digital asset corporations entry to tax breaks and state funding.
Dunamu paid ₩24 billion in taxes after dropping enterprise standing in 2018.
Coverage is a part of President Lee’s pro-crypto financial technique.
South Korea is transferring to formally recognise crypto companies as enterprise firms, a call that might give the business entry to tax aid, government-backed loans, and startup funding for the primary time.
The Ministry of SMEs and Startups has launched a proposal to reclassify digital asset corporations, eradicating them from an inventory of restricted industries that features playing and nightlife.
If handed, the coverage would reverse a long-standing rule that has blocked crypto startups from the nation’s thriving enterprise ecosystem.
This legislative push follows years of regulatory exclusion, with one main flashpoint in 2018. Dunamu, the father or mother firm of crypto trade Upbit, misplaced its enterprise standing and was compelled to pay ₩24 billion ($18 million) in taxes.
Dunamu challenged the choice in court docket however misplaced, highlighting the monetary penalties of South Korea’s earlier stance.
The ministry now says it needs to acknowledge the modern and entrepreneurial qualities of crypto firms, bringing them according to different rising know-how sectors.
New legislation aligns with Seoul’s broader pro-crypto pivot
The proposal marks a major departure from earlier coverage. Till now, crypto-related companies have been grouped with sectors barred from receiving authorities assist.
The proposed revision would take away digital asset corporations from this restricted class, permitting each new and present startups to register as enterprise companies with out risking their certification.
The ministry argues that the brand new framework will broaden South Korea’s enterprise ecosystem and promote development within the blockchain and crypto industries.
Public suggestions on the draft legislation is being collected till 18 August 2025, signalling the start of a proper legislative course of.
If enacted, it will allow crypto corporations to entry the identical assist instruments—equivalent to tax cuts, subsidies, and mortgage ensures—which are presently out there to different recognised startups.
The change might additionally profit firms that already maintain enterprise standing and wish to broaden into crypto, which beforehand risked dropping their designation in the event that they added digital asset operations to their enterprise fashions.
President Lee’s crypto insurance policies start taking form
The enterprise firm proposal is considered one of a number of initiatives beneath President Lee Jae Myung’s new administration. Since taking workplace final month, Lee has made digital property a cornerstone of his financial technique.
His authorities is supporting the approval of spot Bitcoin exchange-traded funds (ETFs), exploring a won-based stablecoin, and reviewing the continued ban on institutional buying and selling of cryptocurrencies.
Main South Korean banks are already responding. Some have filed emblems for stablecoin merchandise, whereas others are engaged on blockchain infrastructure and digital pockets companies.
Trade legitimacy and funding might comply with
The proposed authorized modification might have wide-reaching results past tax incentives.
Recognising crypto corporations as enterprise firms might lend credibility to an business that has lengthy operated on the fringes of formal finance in South Korea.
Higher legitimacy might entice institutional buyers, encourage new enterprise formation, and scale back compliance-related friction.
It might additionally align South Korea with different markets advancing related insurance policies, such because the European Union’s MiCA framework and Japan’s reforms to permit restricted crypto fundraising.
With venture-backed crypto initiatives probably having access to financial institution loans and innovation grants, the ecosystem may even see accelerated growth and a stronger foothold in South Korea’s broader tech financial system.
Public submissions on the proposal are presently open, with last selections anticipated later this 12 months.
