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South Korea Classifies Select NFTs as Regular Cryptocurrencies, Reports Say
South Korea’s Financial Services Commission (FSC) has unveiled new guidelines to clarify the regulatory landscape for non-fungible tokens (NFTs). According to the guidelines, certain NFTs that exhibit properties similar to cryptocurrencies—such as mass production, exchangeability, or use in payments—will now be regulated as cryptocurrencies. This move is part of South Korea’s efforts to provide clarity and reduce ambiguity in the digital asset space.
Not all digital tokens will fall under this strict regulation; NFTs that are non-transferable and hold minimal economic value will be regarded as regular NFTs. For example, NFTs used as proof of transaction or concert tickets remain classified under the traditional NFT category. This distinction ensures that only NFTs functioning like financial instruments or currencies face stringent oversight.
These changes precede the enforcement of South Korea’s first crypto-focused law, the Virtual Asset User Protection Act, set to take effect on July 19. This law aims to protect users by mandating crypto service providers to secure funds and prevent market abuses, marking a significant step in South Korea’s comprehensive approach to standardizing and securing the crypto landscape.
