Bitcoin Is Winning Issue in South Korean Election

  • Cryptocurrencies were a central issue in the most recent South Korean elections.
  • Bitcoin-friendly Yoon Suk-yeol won the presidency.
  • Bitcoin will become an increasingly important issue in elections around the world.

South Korea is one of the most technologically advanced nations on earth and the tenth largest economy. According to Chainalysis, South Korea ranked 13th in the world for on-chain value received and 40th overall in their 2021 Global Crypto Adoption Index. Data from the country’s financial regulator shows the local cryptocurrency market is worth ~$45bn and that over 15 million people, or ~30% of the population, have accounts with crypto exchanges. Bitcoin and other cryptocurrencies played a central role in its most recent presidential elections, as opposing candidates competed with each other to appear the most crypto-friendly in order to win over the crucial younger vote.

The two leading presidential candidates, Yoon Suk-yeol and Lee Jae-myung, tried to outdo each other with crypto-related campaign promises such as deregulation, reversing an ICO ban and making the tax environment more attractive. They also issued thousands of NFTs as a way to promote their campaigns. In the end, Bitcoin-friendly candidate, Yoon Suk-yeol, won the March elections. The incoming president has promised a whole raft of crypto-friendly reforms to attract capital and start building crypto unicorns. He has expressed a desire to deregulate the sector as much as possible and align taxes on cryptocurrencies with other capital gains. This would lift the tax threshold on cryptocurrencies from ~$2,000 to ~$40,000 and make South Korea one of the most attractive tax jurisdictions in the world for crypto gains. Yoon has also proposed to establish the Basic Digital Asset Law designed to aid in the recovery of funds lost to illegality and insurance policies to protect investors. This victory may make South Korea a new global crypto hub and may foreshadow the role that Bitcoin will take in other elections around the world.

As we argued elsewhere, Bitcoin will become an increasingly important factor in electoral politics. The South Korean election may just be the first of many examples. Similar dynamics are shaping up in the US electoral system. Voters will increasingly clamour for Bitcoin to be adopted as legal tender and will keep lobbying for Bitcoin-friendly regulations. This is just the beginning.

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