Busan’s Digital Asset Exchange to Transform the City into a Global Financial Hub
Busan, the southern port city in South Korea, has unveiled an extensive plan for the creation of the Busan Digital Asset Exchange. The primary aim of this initiative is to establish a blockchain-based exchange that facilitates the trading of a wide range of valuable assets, including raw materials, precious metals, intellectual property rights, and carbon emission rights, all through tokenization.
Decentralized governance model
This planned exchange will operate under a decentralized governance model, where separate entities will handle depository and settlement, listing assessment, and market monitoring. Such a governance framework is designed to ensure checks and balances and enhance investor protection. Busan is committed to providing both administrative and financial support for the establishment of these entities.
The roadmap for this plan was presented yesterday at Busan City Hall by Mayor Park Heong-joon and the Busan Digital Asset Exchange Establishment Promotion Committee.
The committee was introduced by the city in December of last year, and since then, it has been crafting specific plans. This committee is led by former lawmaker Kim Sang-min, who is recognized as an expert in blockchain policy.
Operator selection process
The legal operator for the exchange is slated to be launched within this year. Starting from the middle of the upcoming month, the city of Busan will initiate an application-based process to find an exchange operator and intends to finalize the selection by November.
The operator will be entirely funded through private contributions. Companies possessing blockchain technology and the capability to construct an exchange system will form a consortium to partake in the project and operate the exchange. The city of Busan will support the founding and operation of the exchange in accordance with the ordinance.
Diverse asset tokenization
Should everything proceed as planned, the exchange is set to commence operations next year. It will tokenize and support the trading of items that pass through the Port of Busan, including gold, silver, copper, crude oil, and ammonia. Additionally, a marketplace will be developed to trade intellectual property (IP) rights, such as films, and carbon emission rights. Particularly, there are plans to broaden the spectrum of tradable items to include virtual assets and security tokens.
In contrast to traditional stock exchanges that utilize home trading systems (HTS), the upcoming digital asset exchange will run on blockchain, which is immune to hacking and forgery. Users can trade their assets directly without intermediaries and benefit from reduced transaction costs.
Highlighting blockchain as a pivotal technology in the era of the Fourth Industrial Revolution, Kim Sang-min, the chair of the committee, expressed that Busan will develop its digital asset exchange to set a global standard in the field.
Mayor Park resonated with this perspective, emphasizing that in this age of digital transformation, Busan will leverage this opportunity to position itself as a global financial hub.
