Digital assets: regulation or flexibility? “We need to build a trusted market”

As international discussions surrounding the leadership and regulation of digital asset hegemony intensify due to the rise of stablecoins, Korean-American lawyers from each country unanimously emphasized the need to create a trusted market.

At the 32nd regular general meeting of IAKL held at the Korea University Law School in Anam-dong, Seongbuk-gu, Seoul on September 25, Taejun Bae (37th Judicial Research and Training Institute), attorney at Lin Law Firm, said of the Virtual Asset User Protection Act that was implemented last year, “There is criticism that Korean-style protection regulations are excessive.” The Virtual Asset User Protection Act mandates banks to trust deposits of digital asset users in preparation for fraud and hacking incidents. There was opposition that investment was discouraged due to low liquidity and the possibility of being used as an international payment method was reduced.

Several digital asset basic laws have also been proposed in the National Assembly. It contains regulations such as imposing disclosure obligations on the issuance and distribution of digital assets and prohibiting unfair transactions. Attorney Bae said, “Regulations in Korea tend to be greatly influenced by social or political influences,” and added, “We need to watch for changes in the future.”

Other countries are also strengthening digital asset regulations. A representative country is the United States. First, regulations are being unified. Dong-hoo Son, a foreign attorney at Daeryun Law Firm (New York, USA), said, “The joint statement issued by the U.S. Securities and Exchange Commission and the Commodity Exchange Commission shows a strong will to regulate digital assets.” The two organizations have been fighting over jurisdiction over whether digital assets are securities or products, but formalized regulatory cooperation in September 2025.

The reason for strengthening regulations is to create a highly trustworthy market environment for digital assets. Park Wan-ki, a foreign lawyer at Liberty Chambers (Hong Kong), mentioned a survey showing that public trust in regulated platforms is more than 20% higher than in unregulated platforms, and said, "Hong Kong is trying to become 'Wall Street' rather than the 'Wild West' (the West, a symbol of disorder) of the cryptocurrency market." Hong Kong restricts access to ordinary people, not professional investors, so that they can only invest in digital assets regulated by financial authorities.

Some countries have flexible responses. Switzerland is showing flexibility in the way it regulates digital assets within the existing civil and financial law systems. Park Min-young (2nd bar exam), attorney at Sedam Law Firm, explained, “For some digital assets, tokens are initially issued in Switzerland and then obtained a license in the EU, which has strict consumer protection regulations.”

Attorney Park also warned, "Switzerland has great flexibility, but you must follow the regulations of the market in which you actually want to conduct business. Just because regulations are lax, you should not use them as a means of evasion."

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Digital assets, regulation or flexibility...? “We need to build a trusted market” (Shortcut)