Martial law chaos is continuing to wreak havoc on South Korea’s crypto sector, with the National Assembly vowing to halt all work on related legislation for the foreseeable future.
Per Chosun Ilbo, the National Assembly voted in favor of a legal amendment that will delay the launch of crypto tax until January 2027.
However, both major parties agreed on the details of this amendment prior to President Yoon Seok-yul’s ill-fated decision to declare martial law on December 3.
Martial Law Chaos Derails Crypto Progress
The media outlet reported that the National Assembly, which is now under heightened pressure to approve next year’s budget, has “moved into full-blown impeachment mode.”
The crypto industry is still “waiting for legislative clarity.” But firms are now “braces for another sluggish wait” for change, Chosun wrote.
The crypto tax law passed in the very nick of time, gaining approval on the very last day of the current plenary session.
The bill had been slated for debate on December 4. Had the Assembly failed to vote on December 10, crypto tax would have launched as scheduled on Janaury 1, 2025.
An All-stop Order
The media outlet wrote that all “virtual asset-related” issues have now been pushed back in priority.
It added that parliamentarians have agreed to an “all-stop” on all crypto-related matters.
This means that a number of pressing crypto-related matters will likely remain in limbo until mid-2025.
These include:
South Korea’s long-standing initial coin offering (ICO) ban, which Yoon promised to “review” prior to his election A decision on whether domestic companies can buy crypto with their balance sheets A decision on securities token offering (STO) legalization, another Yoon manifesto promise A ruling on the legality of Bitcoin spot ETFsThe newspaper wrote that all these issues and more “have been buried under the impeachment issue, making it impossible to expect a vote” on any of them.
Instead, the National Assembly is “focusing on issues such as martial law, impeachment, and the next presidential election.”
A Lifeline for Corporate Crypto Investors?
The situation is not completely hopeless for crypto firms, however.
The Financial Services Commission has recently “finalized step-by-step guidelines” for corporate crypto accounts.
In theory, it could implement most of these steps without relying on the National Assembly’s help.
The newspaper wrote that STO-related discussions would “not progress until the first half of next year,” despite the fact that both parties broadly agree on the matter.
Moving Overseas?
An unnamed National Assembly “insider” was quoted as stating:
“The martial law crisis has taken all of the National Assembly’s attention. So it is hard to justify dealing with virtual assets now, even though there are many outstanding bills that need work. We should view this as an indefinite postponement. It will last at least until the impeachment situation is resolved.”
However, the outlet noted that there are now “concerns” that more domestic “blockchain and virtual asset companies and investors” will “relocate overseas due to the martial law situation.”
Crypto players have urged Seoul to roll out clearer guidelines. But it seems they will be left waiting until mid-2025 for answers.
“There is a lot to discuss in the cryptoasset sector. But the current situation is regrettable. In the US, President-elect Donald Trump is looking to appoint people to handle virtual asset policies before he even takes office. It is urgent for South Korea to act quickly, too.”
Kim Gap-rae, Senior Researcher, Capital Market Research InstituteThe post Martial Law Chaos: South Korea Pauses ‘All’ Work on Crypto Legislation appeared first on Cryptonews.
