Korea’s top financial regulator will announce the results of its fact-finding inquiry into initial coin offerings (ICOs) by the end of November.
In a policy symposium co-organized by the Korea Institute of Finance and the Korean Securities Association Wednesday, Financial Services Commission (FSC) Vice Chairman Kim Yong-beom said the results will come out this month, adding that “we will share the results and announce what we will do.”
The financial regulatory body has been carrying out a survey of Korean companies that already conducted ICOs or were preparing for ICOs since September. But Kim didn’t elaborate on whether the government will change its position on ICOs, saying, “The survey was just intended to find what’s happening now. It’s unclear if we will announce our finalized position.”
Meanwhile, there were suggestions in the symposium that ICOs must be seen as something similar to private equity funds. Prof. Hong Ki-hoon at Seoul-based Hongik University said, “Unlike initial public offerings (IPOs) that envision selling ownership of verified companies in public, ICOs are designed to raise capital to implement unverified business models.” He proposed regulating ICOs in ways that private equity funds are regulated, saying, “ICOs are more similar to private equity funds rather than IPOs or crowdfunding.”
Prof. Hong also refuted allegations that ICOs are similar to crowdfunding. “ICOs are essentially a funding method in which founders adopt the crowdfunding scheme to receive ‘series A investment’ with unverified ideas,” he said, arguing that it will be most effective to regulate ICOs with the philosophy and format applied to private equity funds.
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