South Korea’s Financial Services Commission (FSC) chief nominee, Lee Eok-won, has come under fire from the cryptocurrency industry for saying that cryptocurrencies lack intrinsic value.
He reportedly said that cryptocurrencies fail to meet the fundamental criteria of a currency.
These remarks were made while South Korea navigates the complex landscape of digital asset regulation.
Lee argued that cryptocurrencies bring about high price volatility, and therefore are unable to serve as a reliable store of value or medium of exchange.
Furthermore, Lee expressed concerns about the speculative nature of crypto markets, casting doubt on the suitability of allowing pension and retirement funds to invest in such assets.
The nominee’s comments have drawn sharp criticism from South Korea’s crypto community.
Industry leaders say his stance is regressive.
Blockchain experts countered Lee’s claims, highlighting the intrinsic value of cryptocurrencies like Bitcoin, including security and transferability on blockchain networks.
They also pointed to the growing adoption of crypto by governments and corporations worldwide as evidence of its practical worth.
Support for Stablecoin Innovation
Despite being sceptical about cryptocurrencies, Lee expressed cautious support for South Korea’s stablecoin project.
South Korea plans to develop a local currency-pegged stablecoin, endorsed by President Lee Jae Myung, mirroring similar efforts in Japan and Hong Kong.
When it comes to stablecoins, Lee emphasized the need to balance innovation with robust safety measures.
He also addressed the FSC’s exploration of spot crypto exchange-traded funds (ETFs).
While acknowledging concerns about market volatility, he promised to collaborate with lawmakers to advance the initiative.
Crypto Industry Pushback
The criticism against Lee’s remarks magnifies the growing tension between South Korea’s regulation and the crypto sector.
Industry advocates argue that dismissing the intrinsic value of cryptocurrencies overlooks their transformative potential in decentralized finance and global transactions.
As South Korea positions itself as a leader in Web3 and blockchain innovation, Lee’s confirmation hearing is expected to draw intense scrutiny from both supporters and critics of digital assets.
