The candidate nominated to chair South Korea’s Financial Services Commission said cryptocurrencies “have no intrinsic value,” a remark that drew rejection from the crypto sector and reopened a debate on the country’s regulatory direction. This comment arrived as lawmakers consider bills on spot ETFs, bank-backed stablecoins and the classification of crypto companies, and it may shape immediate oversight and longer-term policy choices.
Context and immediate results
The nominee’s skeptical view comes amid a regulatory plan that seeks to balance innovation with investor protection. Regulators are discussing stricter oversight of products such as spot ETFs, possible limits on institutional and pension fund exposure, and interest in won-backed stablecoins issued by banks, creating tension between enabling progress and containing systemic risks.
Arguments from the sector and technical counterpoints
Supporters argue that crypto value derives from technological utility—decentralization, cryptographic security and peer-to-peer transferability—while critics point to volatility, fraud and illicit use as reasons for tighter controls. The debate highlights that value can be seen as functional and network-based rather than intrinsic, and that policy must weigh legitimate use cases against documented harms.
Disputed elements
Key disputes center on intrinsic value versus usefulness, the scope of institutional access, and the design of regulated stablecoins with verifiable cash backing. These disagreements will influence accounting and tax treatment, whether pensions and other institutional investors can hold crypto, and the custody, transparency and reserve requirements for any regulated stablecoin model.
Probable regulatory situation
The most likely path is careful regulation that permits controlled openness rather than outright bans. Policymakers are expected to require custody and disclosure from issuers, set clear rules for spot ETFs, review exchange practices and align domestic rules with international standards while limiting excessive institutional exposures where necessary.
Implications for financial control and decentralization
Excessive regulation risks stifling innovation and driving talent abroad, while well-designed rules can improve financial oversight and help domestic markets compete globally. Preserving elements of decentralization and preventing disproportionate control will be important to maintain core values of crypto ecosystems while protecting consumers and the financial system.
The FSC nominee’s comment has reignited the debate over what constitutes value in digital assets and how to regulate them without halting progress. South Korea faces the challenge of crafting rules that reduce concrete harms without imposing constraints that weaken competition and financial freedom.
