The transfer would give digital asset companies 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 corporations, a call that would give the trade entry to tax reduction, government-backed loans, and startup funding for the primary time.
The Ministry of SMEs and Startups has launched a proposal to reclassify digital asset companies, 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 courtroom however misplaced, highlighting the monetary penalties of South Korea’s earlier stance.
The ministry now says it needs to acknowledge the revolutionary and entrepreneurial qualities of crypto corporations, bringing them according to different rising expertise 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 help.
The proposed revision would take away digital asset companies 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 develop 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 could allow crypto companies to entry the identical help instruments—reminiscent of tax cuts, subsidies, and mortgage ensures—which can be presently obtainable to different recognised startups.
The change might additionally profit corporations that already maintain enterprise standing and wish to develop 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 certainly 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 continuing 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 providers.
Trade legitimacy and funding might comply with
The proposed authorized modification might have wide-reaching results past tax incentives.
Recognising crypto companies as enterprise corporations might lend credibility to an trade that has lengthy operated on the fringes of formal finance in South Korea.
Better 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 doubtlessly having access to financial institution loans and innovation grants, the ecosystem might even see accelerated growth and a stronger foothold in South Korea’s broader tech economic system.
Public submissions on the proposal are presently open, with remaining choices anticipated later this 12 months.
