Newly built cryptocurrency exchanges won’t get venture business certifications any longer. Crypto trading platforms that have already received such certifications won’t be able to renew their certifications either.

Prime Minister Lee Nak-yeon Thursday chaired a Cabinet meeting to approve an enforcement decree on the Special Law on the Promotion of Venture Businesses that would remove cryptocurrency exchanges from the category of venture businesses. The decree will go into effect in October upon being published in the official gazette.

However, of the 10 industry classifications in blockchain technology notified by Statistics Korea July 27, nine classifications other than the cryptocurrency exchange business will remain valid as venture businesses under the revised decree.

“Cryptocurrency exchanges are excluded from the venture business category as the relevant industry has been beset by such social problems as excessive speculation, pseudo-funding, money laundering and hacking,” said an official at the Ministry of SMEs and Startups, adding that “corporate activity, however, won’t be affected because the revised decree won’t regulate crypto asset transactions and brokerages.”

The official said the red tape on the new crypto exchanges will be lifted if the time comes when social problems are resolved.

Under the enforcement decree, crypto trading platforms will be grouped together with bars and night clubs and therefore are excluded from policy and taxation benefits granted to venture enterprises.

Cryptocurrency exchanges and related associations have been raising their voices in the run-up to the Korean government’s latest restriction on cryptocurrencies. In its statement on Aug. 27, the Korea Blockchain Association lambasted the ministry’s proposed decree as the “Red Flag Act” and expressed grave concern about the government’s policy directions.

/Jaeyeon Won Reporter wonjaeyeon@decenter.kr

Jaeyeon Won Reporter