ICON hosts briefing on Jeju’s effort to build Korea’s most crypto-friendly regulatory regime

You’d think it’d be hard to fill up a room for a talk on provincial regulations. But it was nearly standing room only in the ICON headquarters’ lounge on February 27 when ICON hosted a briefing session on the so-called “Jeju Blockchain Regulatory Sandbox.” More than 60 people from 30 blockchain companies and a handful of journalists took time from their afternoons to hear two local officials explain how they intend to turn a volcanic resort island off Korea’s southwest coast into the country’s most hassle-free incubator of blockchain technology.

Removing legal gray areas, encouraging innovation

Heeseop Roh, Director of the Jeju Future Strategy Department

Jeju and the southeastern port city of Busan hope to become “blockchain special zones” when the Act on Special Economic Zones goes into effect from April. The law grants districts recognized as special economic zones the ability to exempt companies in selected industries from one or many of 201 existing regulations and provide a range of  benefits  such  as  financial  and  tax support. Jeju plans to apply for the status  in  May and is now taking applications from companies that want to take part. A prime ministerial commission will review the application in July.

While the Seoul government has taken a cautious approach to digital currency and blockchain, Jeju has shown unbridled enthusiasm for the technology. Leading the charge is crypto-friendly governor Won Hee-ryong, who has pledged to turn the island into a “blockchain hub city.” The province is also putting together a strategic KRW 25-30 billion fund aimed at blockchain; KRW 15 billion has already been raised.

ICON has played an active role in Jeju’s blockchain initiative. Accordingly, attending the briefing were representatives from ICONLOOP, Deblock and ICON DApp partners such as Airbloc, Cosmochain, Webloc, SOMESING, STAYGE and VELIC.

Heeseop Roh, the Director of the Jeju Future Strategy Department, and Youngsoo Han, the Section Chief of the Jeju Future Strategy Department, spent most of the briefing running through the specifics of Jeju’s regulatory scheme. If the province’s application is approved, companies participating in the special zone will be able to take advantage of several special regulatory circumstances. These circumstances would build a simple system to approve projects by removing legal grey areas, permit testing and demonstrations prior to the application of regulations, and allow the creation of markets prior to the adoption of regulations.

Section Chief Youngsoo Han

ICOs? Maybe…

The officials also fielded questions. Unsurprisingly, many in the audience were keen to hear whether Jeju could or would circumvent the national government’s de-facto ban on ICOs. Han said the local government would definitely do something to mitigate the legal grey zone in which ICOs find themselves. He also explained that while he couldn’t say too much since discussions were ongoing, there might be some room for the province to free up ICOs through local ordinances.

Audience members expressed hope that Jeju’s efforts will eventually pay off.

“I think it would be great if Jeju’s sandbox works out like in Malta or the UK,” says Moshua Choi, the CEO of blockchain gaming developer SuperTree. “With blockchain, you need to move quickly. There are lots of companies offering good services in Korea, but they can’t because of regulations.”

Yu Jongwon, the head of business development at Carry Protocol, a blockchain project for offline SMBs, had wanted to know more about Jeju’s initiative, but had little in the way of details. The briefing helped a lot. “I had been curious about the plan,” he says. “Since today’s briefing answered a lot of my questions, I think it turned out well.”