South Korea has ended a seven-year restriction that prevented virtual asset trading and brokerage companies from being recognized as venture firms. The policy change is viewed as a step toward aligning national startup regulations with global trends, opening the door for blockchain and other digital asset technologies to play a stronger role in the country’s innovation economy. For both entrepreneurs and investors, the reform is expected to unlock new opportunities in one of Asia’s most tightly regulated crypto markets.
The Ministry of SMEs and Startups (MSS) confirmed on September 9 that the Cabinet approved an amendment to the Enforcement Decree of the Special Act on Fostering Venture Businesses. Beginning September 16, cryptocurrency trading and brokerage companies will be eligible to apply for venture certification under the same framework as other innovative enterprises.
The original restriction, introduced in October 2018, grouped crypto businesses alongside nightlife and gambling operations. At the time, authorities imposed the measure amid fears of speculation and consumer risks, but industry leaders criticized the decision as a setback for competitiveness and innovation.
Global and Domestic Shifts in Regulation
Conditions have shifted significantly since the restriction was first put in place. In the United States, the approval of Bitcoin spot exchange-traded funds in 2024 and the passage of the GENIUS Act for stablecoin regulation in 2025 demonstrated growing institutional acceptance. Companies such as Coinbase, Gemini, Circle, and Bullish have pursued or secured listings on Nasdaq and the New York Stock Exchange, further underscoring the mainstreaming of digital assets.
South Korea has also advanced its own regulatory framework. In 2021, the government introduced a licensing regime for virtual asset service providers, and in July 2025, the Virtual Asset User Protection Act took effect. The legislation mandates deposit protection, record retention, and safeguards against unfair trading practices, addressing many of the concerns that shaped earlier restrictions.
This evolving environment has reinforced the view that digital assets are no longer an unregulated risk but a key component of modern finance. Critics had long argued that treating crypto firms as equivalent to gambling operators not only misaligned Korea with international developments but also limited its ability to compete for global fintech and blockchain talent.
Equal Footing for Blockchain Startups
By removing the restriction, MSS intends to give blockchain and crypto startups access to venture certification, a status that can unlock financing options, attract risk capital, and provide entry into state-supported innovation programs. The reform places digital asset ventures on par with other deep-tech sectors such as biotechnology, semiconductors, and artificial intelligence.
Minister of SMEs and Startups Han Seong-sook explained that the reform is designed to align Korea with global digital asset trends and secure new growth engines. The ministry indicated it would focus on fostering a transparent and responsible ecosystem where venture capital can flow smoothly and innovative industries can scale.
Industry analysts suggest that the decision will make Korea more attractive for both domestic founders and international investors seeking regulated entry points into the Asia-Pacific market. Programs such as TIPS and the K-Startup Grand Challenge, previously limited in reach, could now extend their support to blockchain-focused companies.
Toward a Growth-Oriented Startup Ecosystem
The lifting of restrictions signals a broader change in the government’s stance, moving from a defensive approach toward a growth-oriented opportunity model. Blockchain, cybersecurity, and other digital asset technologies will now be treated as strategic priorities rather than speculative risks.
The shift is expected to strengthen Korea’s position as a hub for deep-tech investment while sending a clear message of long-term commitment to integrating digital assets into the national innovation economy. For startups, the recognition offers a pathway to scale solutions domestically and expand reach abroad, accelerating the pace of blockchain adoption across sectors.
