According to local sources, a similar scenario is forming in South Korea’s domestic markets following the US Government’s declaration of tapering sent cryptocurrency into a tailspin. The Bank of Korea has hinted at another rate hike in 2022, after elevating the price level two times to 1 percent in 2021.
Gold Prices Plummeting
Bank of Korea’s Governor Lee Ju-yeol stated that following the development in financial circumstances, we’d need to alter the number of financial policies relaxing correctly. Due to that, gold prices dropped to their lowest point in 6 years. Digital assets are becoming attractive financial products as a result.
A banker remarked regarding the scenario described above: I can’t argue that digital assets are superior to gold just yet, however assuming the planet’s flow towards NFTs and digital assets increases, it has the potential to grow as large as the stock market.
According to Kim Hee-Jeong, Head of the NH All100 Advisory Center, clients who plan on investing in cryptos significantly surged. While cryptos aren’t included in consumers’ portfolios due to their high volatility, customers who wish to engage in the asset class have increased.
Nonetheless, as the interpreted statement pointed out, local banking institutions aren’t aggressively engaging in digital assets due to the state’s standpoint. Several equity investigations are seen as digital service investments propagate further than the twenty-thirty generation to the seniors. In addition, following 2021’s positive results, South Korean organizations are again converting to digital assets in 2022.
Increase of Cryptocurrency Demand in South Korea
Based on another publication, local securities firms have been issuing analyses of virtual assets since the start of 2022. This also implies that the asset class should be included in investments. Strong demand in the digital asset marketplace has moved the category into a packed institutional structure, according to Jae-sun Lee, a researcher at Hana Financial Investment, who told the local publication.
Choi Hyun-man, Chairman of Mirae Asset Securities, added that market opportunities and enterprises have emerged due to the introduction of technologies like bitcoin, blockchain, metaverse, and NFT.
Nevertheless, the nation has been enacting strict regulations around digital assets and their taxes since last year. The Ministry of Culture, Sports and Tourism’s Game Management Committee (GMC) has delivered an official document to smartphone application markets. The message instructed businesses to block speculative money-making games, also known as play-to-earn games, a central section of the cryptocurrency ecosystem.