South Korea Funds Crypto Startups with KRW200B Tax Breaks
South Korea’s Ministry of SMEs and Startups has formally included crypto startups in its venture ecosystem. From Q3 2024, eligible cryptocurrency exchanges, blockchain developers and DeFi projects can apply for grants, tax incentives and government-backed loans under existing programmes.
The government has earmarked KRW200 billion over two years for blockchain and crypto startups, with up to KRW50 million per firm annually. The reform reverses a 2018 ruling that stripped digital asset firms like Dunamu of venture status. Public consultation on the draft law runs until August 18, 2025.
The policy also aligns with plans for spot Bitcoin ETFs and a won-based stablecoin, reflecting Seoul’s push for clearer regulatory support and reduced compliance hurdles. Traders can expect improved funding access and institutional investment, boosting market confidence in crypto startups and potentially driving broader blockchain innovation.
Bullish
This policy is bullish for the cryptocurrency market, particularly Bitcoin and blockchain-related assets. In the short term, formal recognition and substantial KRW200 billion funding for crypto startups will boost investor sentiment and liquidity, potentially driving higher trading volumes. Over the long term, clearer regulatory support, tax incentives and government-backed loans are likely to attract institutional investors and foster innovation within the blockchain sector. The alignment with spot Bitcoin ETF plans and stablecoin development further strengthens market infrastructure, supporting sustained growth and price appreciation.