Dunamu CEO cries foul over lawmakers’ misconception

Dunamu CEO Lee Sirgoo urged politicians to reform the current regulations on digital assets in line with international standards, without hesitating to express his concerns over lawmakers and government officials maintaining negative views concerning blockchain and cryptocurrencies.

“I was summoned to next Thursday’s National Assembly audit as a witness to answer questions on how to protect consumers amid the rapid growth of the virtual assets market and how to prevent accidents similar to the Terra-Luna crisis,” Lee said in his keynote speech during the American Chamber of Commerce in Korea’s (AMCHAM) blockchain seminar, Thursday. “I have attended National Assembly audits several times, but I have always been unable to explain the industry’s position to lawmakers.”

The head of the company operating Upbit, the nation’s leading cryptocurrency exchange, added that it has been difficult for him to convince financial and legal authorities who see his company’s business model as a scam.

“Although I was able to meet with some lawmakers, most of them hardly understood blockchain technologies,” he said. “Former Minister of Health and Welfare Rhyu Si-min described bitcoin as the ‘most elegant fraud in history,’ and his perspective has been shared by regulators.”

Lee noted that such views have made it difficult for the Korean government to cope with the significant volatility in the cryptocurrency market during the pandemic, as the authorities had not prepared proper countermeasures after the sharp decline in the bitcoin price in 2018.

He also pointed out that Korea’s unreasonable regulations have hindered domestic blockchain companies from utilizing their technologies to compete with rivals in the global market.

For Korea to utilize its leading blockchain technologies and become one of the global economic hubs, the Dunamu CEO proposed a new categorization of various crypto assets. Under the current law, all crypto assets are regarded as “securities.”

“Crypto assets are developed to perform diverse tasks, and therefore can be classified under a few different types of categories such as payments, securities, networks and various utilities,” he said. “Categorizing asset types will fill the regulatory blind spots.”

During the seminar, Financial Supervisory Service (FSS) Governor Lee Bok-hyun and Rep. Yun Changhyun, chair of the virtual assets committee for the ruling People Power Party, agreed on the necessity of balanced regulations for innovation in the domestic blockchain industry.

Industry experts also discussed issues related to blockchain, cryptocurrencies and non-fungible tokens (NFTs) in three sessions. One session dealt with regulation and promotion, the second was about technological development and business trends, and the third focused on digital assets as investment instruments.

“This is a crucial moment for Korea to decide how it will handle blockchain and what role it will play in the global digital asset market,”

AMCHAM Chairman James Kim said. “In this context, it is critically important to create a sustainable regulatory environment where all of us can thrive long-term and find a balance between promotion and regulation.”