South Korea to Allow Crypto Exchanges to Register as Venture Companies

Highlights:

• South Korea plans to let crypto firms register as venture companies and access tax and financial benefits.
• Crypto exchanges may qualify for venture status under the new law and receive support like other startups.
• The policy shift supports President Lee’s crypto plans, including stablecoins and spot crypto ETFs.

The Ministry of Small and Medium Enterprises and Startups in South Korea has proposed a legal change to support digital asset businesses. The ministry announced the proposal on July 9, seeking to amend the Special Act on Promoting Venture Businesses. This amendment would allow crypto-related companies to register as venture firms and access government support. The proposal removes restrictions that have kept these firms off the approved list for venture certification.

SOUTH KOREA IS SET TO RECLASSIFY #CRYPTO FIRMS AS “VENTURE COMPANIES”. 📢

ALLOWING THEM ACCESS TO TAX CUTS AND OTHER STARTUP BENEFITS.

THOUGHTS? pic.twitter.com/vLVkOm7Wpm

— The Moon Show (@TheMoonShow) July 9, 2025

At the moment, crypto companies are grouped with restricted industries like gambling and nightlife businesses. Such companies have been ineligible to be registered as venture companies since 2018. Conversely, certified venture firms are given tax exemptions, grants, and other rewards depending on investment, research, or innovation. The new amendment will seek to treat crypto businesses as any other startup and provide them equivalent privileges.

The current restrictions have already affected some major companies in the sector. Dunamu, the operator of crypto exchange Upbit, lost its venture certification in 2018. This led to an $18 million increase in its corporate tax bill and the loss of earlier incentives. The company appealed against the judgment but was unsuccessful. The new amendment would prohibit such events from occurring in the future, as it acknowledges that crypto businesses can receive venture status.

Crypto Exchanges May Qualify for Tax Breaks

The current amendment may introduce significant transformations to crypto exchanges in South Korea. These exchanges, categorized as virtual asset service providers, would now be able to register as venture firms. After being registered, they would have access to tax relief, easier loan access, and other related benefits from the government.

According to the ministry, recognizing crypto exchanges as venture firms would help expand the startup ecosystem. It would also support the growth of the local virtual asset market. The change applies to crypto companies that show strong business potential and innovative services. The reclassification would enable the crypto platforms to work just like the rest of the technology-based startups.

Policy Shift Reflects Broader Crypto Strategy

The proposal is also part of a bigger national agenda under the new South Korean president, Lee Jae-myung. Since taking office, Lee has pushed for changes that support crypto assets and blockchain services. He has also encouraged efforts to create stablecoins tied to the Korean won. In response, financial firms have started filing trademarks for stablecoin-related products.

The president has also backed plans to lift the country’s ban on exchange-traded funds tied to crypto. The Financial Services Commission has already presented a roadmap to permit spot crypto ETFs. This roadmap provides the path to the implementation of such ETFs by the end of 2025.

The proposed amendment and other subsequent efforts are indications of increased recognition of digital finance in South Korea. In case the law is enacted, crypto exchanges will be able to access the state support programs. In addition, this would enable them to become part of the formal venture business environment in the country.