Busan, South Korea is a 'regulation-free' zone for crypto companies
|- Busan will host a wide range of blockchain offerings though it doesn't allow international-level crypto initiatives.
- A total of 11 regulations have been lifted for this project.
South Korea's national government has declared Busan to be a "regulation-free" zone for blockchain development. The move has been formalized as a part of a broader liberalization push. According to the Korea Herald, the Ministry of SMEs and Startups announced that Busan will be hosting a vast range of blockchain offerings. These will be related to finance, public safety and tourism, though it stopped short of fully opening the market and enabling international level crypto initiatives.
A total of 11 regulations have been lifted for the project. Investors are expected to move 29.9 billion won ($25 million) into the region by 2021 and development will be spread between the Munhyeon Innovation District, the Centum Innovation District and the Dongsam Innovation District.
A Korean Exchange-listed local institution named BNK Busan Bank will be supervising blockchain management. Hyundai Pay is supporting payment solutions and advances in tourism. The firm signed a memorandum of understanding with the city back in February. The memo stated that it would move its headquarters to Busan and develop blockchain infrastructure using the Hdac blockchain platform.
Some of the other elements of the program include a public safety offering by Gyeonggi Province-based Coinplug, which claims to be the largest holder of blockchain patents in Korea. The development will consist of an app that enables the users to video record natural disasters and crimes and sends it to the appropriate authorities with all location information. A reward system is expected to encourage more users to use the app. The next stage will have a database that will allow storing and sharing of information.
However, the region won't be regulation-free entirely. ICOs will not be allowed and the project is still decidedly conservative in terms of cryptocurrencies. The planned stablecoin will be highly limited in terms of its use. It will be a part of the reward system encouraging participation in the other local blockchain offerings. It can only be redeemed at certain establishments, acting more as a voucher than a coin. Busan has said explicitly that the reforms are not designed to be cryptocurrency-related.
The recent designation of Busan as Korea's blockchain capital is linked to a broad policy drive by Korea's present administration. Moon Jae-in, the country's President, has been promoting 'regulatory sandboxes.' These will enable a temporary suspension of rules so that new technologies and services can be tested outside the complex legal and bureaucratic environment in the nation.
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