South Korean FIU rejects Hanbitco’s bid to become fiat-to-crypto exchange

Experts Discuss Korean Security Token MarketSince the Korean financial regulator released regulatory guidelines on security tokens in February, many have anticipated that the introduction of security tokens would transform the concept of investment and give rise to new market strategies based on blockchain technology.©Pexels/PixabayIndustry professionals have expressed their opinions on the matter in interviews with media outlets.Token issuance and distributionPark Hyo-jin, vice president at Sejong Telecom, in a recent interview with Korean media outlet Digital Today, expressed his disappointment about the Korean government’s decision to separate token issuance from token distribution. Sejong Telecom is the developer and operator of the blockchain-based real estate fractional investment platform Bbric.According to Park, the capital market law separates token issuance from token distribution in order to prevent conflicts of interest, as interested parties may attempt to control financial products according to their own preferences. However, things are different with security tokens, Park believes. With the help of blockchain technology, a mainnet can issue and distribute tokens without intermediaries.Higher investment limitsPark emphasized the importance of increasing investment limits and cited the small size of the Korea New Exchange (KONEX), a stock exchange for small enterprises, as a reason for its lack of activity. He added that higher caps would result in positive ripple effects.Regarding real estate security tokens, Park doesn’t expect more profitable products, but sees that more investment choices will be available. He is particularly interested in investment contract securities. One such example is renting a piece of land to farmers to distribute harvest profits.Connection with virtual assetsThe security token market will face limitations if it’s not connected with its virtual asset counterpart. He mentioned the need for a digital asset law to create an ecosystem that links security tokens with virtual assets.Meanwhile, in an interview with Economic Review, Lee Kun-ho, former CEO of KB Kookmin Bank, showed a somewhat pessimistic view about the Korean security token market while admitting its potential.Various uncertaintiesIn his opinion, while real estate holds potential as a security token investment, government policies may introduce uncertainties. Likewise, the markets for music and artwork are also subject to unpredictability. Consequently, security token strategies in these areas could encounter limitations.Lee also sees that some of the services don’t necessitate blockchain technology. It is unlikely that any clear winners will emerge in the short term; therefore, it is vital for the industry to approach this issue with prudence, he added.

Korean Blockchain Game Publisher Joins UNGC to Bolster ESG ManagementWemade, a Korean blockchain game publisher, joined the United Nations Global Compact (UNGC) to bolster its environmental, social, and governance (ESG) management. The company announced its membership through a press release issued on Wednesday.Photo by Noah Buscher on UnsplashUNGC membershipSince its establishment in 2000, the UNGC has evolved into the largest corporate sustainability initiative worldwide. With a membership base of over 20,000 companies spanning across 162 countries, it serves as a platform for organizations to align their operations with ten principles encompassing human rights, labor, environment, and anti-corruption.Annual reportsUnder the guidelines of the UNGC, Wemade will fulfill its commitment by submitting an annual report called the Communication on Progress (COP). The company’s objective is not only to meet sustainable development goals but also to enhance its ESG management. Along with these endeavors, the company will strive to improve its corporate citizenship.ESG managementIn expressing his thoughts on the matter, Wemade CEO Chang Hyun-guk emphasized that the company’s inclusion in the UNGC would serve as a catalyst for driving sustainable growth through ESG management. He underscored its commitment to fulfilling corporate social responsibility and meeting global standards by practicing ESG management, given its position as a leading entity in the blockchain market.Wemade’s three main objectivesMeanwhile, Wemade is practicing ESG management centered on three main objectives: responsible environmental management, inclusive growth for future generations, and transparent governance.

Polymarket activity under scrutiny in Taiwan due to election contractsTaiwanese law enforcement is currently delving into the activities of online influencers and community members promoting Polymarket contracts related to the upcoming presidential election which is due to be held on Jan. 13.Polymarket is a New York-based Ethereum-centric prediction market. The platform runs on the Ethereum layer-2 scaling solution network Polygon. The project invites platform users to bet on the outcomes of a broad spectrum of events, ranging from politics to entertainment.Users deposit USDC stablecoin, choose an event to bet on and purchase “outcome shares” through USDC. The user has the ability to trade those shares anytime before the resolution of the contract.Photo by Ethan Lin on UnsplashPossible election law violationsThe Taiwanese investigation came to light in a report by Taiwan-based crypto publication BlockTempo, which was published last week. The investigation comes as concerns arose about potential violations of Taiwan’s Presidential and Vice Presidential Election and Recall Act, which explicitly prohibits gambling on election outcomes.Multiple influencers and crypto community members have reportedly been subpoenaed for their involvement in Polymarket contracts, allowing users to place bets on the January election. At present, the betting pool for the election holds over $300,000, with a market prediction favoring the Democratic Progressive Party’s Lai Ching-te, also known as William Lai, with a 78% chance of winning.However, the legality of such betting activities is in question under Article 88–1 of Taiwan’s election law. It stipulates that anyone gambling on the outcome of an election or recall in a public place or a place open to the public may face imprisonment, short-term detention or a fine of up to NT$100,000 ($3,196.85).Sherman Lin, an attorney at Taipei-based Lin & Partners, emphasized the seriousness with which law enforcement views gambling activities related to presidential elections in Taiwan. He explained that broad legal interpretations under the Presidential Election and Recall Act have led to investigations and convictions of gambling website operators targeting Taiwanese gamblers. Lin stated:“Law enforcement agencies in Taiwan are vigilant in investigating any gambling activities related to presidential elections.”“Broad legal interpretations have been applied to gambling crimes under the Presidential Election and Recall Act, leading to investigations and convictions of gambling website operators in Taiwan targeting Taiwanese gamblers,” he added.Prohibited in United StatesComparing the situation to the United States, where gambling on election outcomes is illegal in most states, Lin noted that enforcing such regulations often falls under the jurisdiction of the Commodity Futures Trading Commission (CFTC). Polymarket’s Terms of Use explicitly prohibit usage by U.S. persons.Despite potential legal consequences for gambling activities in Taiwan, including participation, promotion and platform hosting for betting pools like Polymarket, Lin pointed out that enforcing actions against overseas entities poses jurisdictional challenges. Taiwan’s legal reach is primarily limited to domestic actors, creating complexities in addressing decentralized platforms like Polymarket.Lin suggested that law enforcement may focus on online influencers who promoted the Polymarket contract, as seen in previous cases involving the collapse of the unlicensed crypto exchange JPEX in Hong Kong.Moreover, while there are legal precedents for pursuing centralized entities organizing election gambling, Lin highlighted that no established legal precedent in Taiwan currently exists for decentralized platforms organizing election betting.