Corporations Bypassing Korean ICO Regulations With Overseas Subsidiaries
Major corporations in South Korea are increasingly establishing cryptocurrency subsidiaries and launching initial coin offerings outside of the country due to prohibitive regulations. They are seeking opportunities in countries like Japan, Switzerland, Singapore, and Gibraltar.
Regulations Driving Away Businesses
An increasing number of corporations in South Korea are establishing cryptocurrency and blockchain subsidiaries abroad due to restrictive regulations. Money Today elaborated:
Korea’s largest Internet and mobile companies have left Korea one after another as they entered virtual currency and blockchain businesses.
Former lawmaker Jeon Ha-jin was quoted by the publication, "global blockchain companies are watching Korea, but the government has kicked out opportunities.” Calling for full legalization of ICOs, he conveyed that the government’s ban on ICOs has blocked funding for companies entering the crypto and blockchain space.
Corporations Seek Opportunities Abroad
In March, Business Korea reported that South Korean healthcare companies are increasingly launching their ICOs abroad including Zikto, My23 Healthcare, and Medibloc, adding:
Domestic companies are leaving South Korea and setting up a subsidiary overseas, like Singapore and Gibraltar, to run ICOs.
Hyundai BS&C, an affiliate of South Korean conglomerate Hyundai group, also recently launched its ICO in Switzerland.
Park Chang-ki, chairman of Governtech and founder of major financial information portal, Paxnet, also established a foundation in Switzerland and launched an ICO.
While token sales are currently banned in South Korea, the Korea Times reported last month that the government may be allowing them in future regulations. "The financial authorities have been talking to the country’s tax agency, justice ministry and other relevant government offices about a plan to allow ICOs in Korea when certain conditions are met,” the news outlet quoted an anonymous source.
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