Korea’s financial regulator establishes dedicated units for crypto oversight

The Turkish Lira (TRY) has become the third largest fiat currency by volume in the cryptocurrency market, according to a report by Kaiko. This milestone was reached as TRY's share of the crypto market hit an all-time high of 19% in early June. The increase in volume is attributed to the country's economic challenges, notably its high inflation rate, which has surpassed 70%, making the lira one of the most volatile fiat currencies globally.Photo by Afdhallul Ziqri on UnsplashFactors influencing the increaseThe shift in the Turkish lira's position in the crypto market is partly due to increased foreign exchange volatility and currency devaluation, common catalysts for cryptocurrency adoption in developing economies. Additionally, geopolitical factors such as a record number of elections and diverging monetary policies have intensified market fluctuations. This environment has favored cryptocurrencies like Bitcoin, which reached new highs against the lira in recent months. For instance, Bitcoin escalated to 2.3 million TRY in March from 979,000 TRY in October 2023. The recent adjustments in cryptocurrency trading platforms, particularly Binance's delisting of certain fiat trading pairs due to banking issues, have also increased the dominance of TRY in crypto transactions. This series of events underscores the growing interconnection between traditional and digital finance markets, highlighting the increasing role of cryptocurrencies in regions facing economic instability. 

Wemade and SK Planet Team Up for Blockchain and Online Platform CollaborationSouth Korean gaming publisher Wemade and SK Group’s data and tech subsidiary SK Planet have entered into a strategic partnership to expand their presence in the blockchain and online platform ecosystem.Photo by GuerrillaBuzz on UnsplashBlockchain integrationThe two companies plan to expand their collaboration through the use of blockchain technology, such as issuing membership non-fungible tokens (NFTs) for OK Cashbag, the membership reward program of SK Planet. They are also actively exploring joint marketing and promotional strategies by leveraging their respective technological and service capabilities.“SK Planet is a company with long-standing marketing platforms like OK Cashbag. We believe we can achieve significant synergy through WEMIX’s partnership with SK Planet. In the future, we will contribute to the growth of the Korean market through connections such as that with Wemade’s transparent society platform Wepublic,” said Henry Chang, CEO of Wemade. Wemade operates the WEMIX3.0 decentralized blockchain mainnet whose native token is WEMIX.“We expect that this partnership will bring innovation to the platform ecosystem and provide users with new experiences and customer value,” added SK Planet CEO Lee Han-sang.Strategic investmentsNotably, both companies are engaging in mutual equity investments to further accelerate their strategic alliance. Wemade and its subsidiary, Chuanqi IP, will acquire 7.08% and 5.31% stakes, respectively, in SK Planet from its parent company SK Square. The acquisition amounts to KRW 20 billion for Wemade and KRW 15 billion for Chuanqi IP, totaling KRW 35 billion (approximately $26 million).SK Planet will acquire KRW 20 billion worth of convertible bonds issued by Wemade along with approximately KRW 15 billion worth of shares held by Wemade Chairman Park Kwan-ho, gaining a 1.27% stake in Wemade.Chairman Kwan-Ho Park will then use the proceeds from this stock sale to purchase WEMIX in a move to support the growth and activation of the WEMIX ecosystem.Meanwhile, Wemade plans to initiate a broad range of partnerships with other major local and international companies following its partnership with SK Planet.

Turkey, a significant player in the global cryptocurrency market, has been anticipated to introduce comprehensive crypto-related legislation in 2024. Despite initial announcements suggesting an early rollout, the specifics of the anticipated regulatory framework remain pending, leaving stakeholders in anticipation. Currently, Turkey operates with limited crypto regulations. While some measures exist, such as those imposed by the Central Bank and the Ministry of Finance’s financial intelligence unit, others remain informal, such as guidance from the Capital Markets Board. These regulations primarily focus on prohibiting certain activities and implementing anti-money laundering (AML) measures.Photo by Dima Rogachevskiy on UnsplashAnticipated reforms and their purposeThe forthcoming legislation is expected to address various aspects of the crypto market, including licensing requirements for exchanges, investor protection measures and taxation. The aim is to align with international standards, potentially aiding Turkey in exiting the Financial Action Task Force's (FATF) "gray list." The regulations aim to enhance investor protection, especially in light of past incidents like the collapse of the Thodex exchange, while also providing a legal framework for crypto taxation. Timing of implementationDespite expectations for an early introduction, the exact timeline for the enactment of the crypto legislation remains uncertain. Industry observers speculate potential connections between the legislation's timing and Turkey's efforts to exit the FATF's "gray list." While some anticipate a release by mid-year, others suggest a delay until later in the year, underscoring the complexity and importance of the regulatory reforms for Turkey's crypto ecosystem.