Lee Eok-won, the nominee to lead South Korea’s Financial Services Commission (FSC), has sparked controversy after labeling cryptocurrencies as having no intrinsic value in a statement ahead of his confirmation hearing.
Lee’s Argument: Crypto Lacks Core Currency Functions
In a written response submitted before the hearing, Lee Eok-won argued that cryptocurrencies cannot serve as a reliable store of value or medium of exchange due to their high volatility. According to Lee, this fundamental issue prevents digital assets from fulfilling the essential roles of traditional currencies.
He further compared crypto to traditional financial products such as deposits and equities, stating that these instruments possess intrinsic value, unlike digital tokens. Lee also expressed skepticism about allowing pension and retirement funds to invest in cryptocurrencies, citing the speculative nature of the market.
Lee’s comments triggered strong criticism from South Korea’s crypto industry. Local blockchain experts and industry leaders described his statements as “regressive”, particularly at a time when governments and corporations globally are integrating crypto into financial strategies.
Analysts argued that cryptocurrencies do hold practical value through their digital utility, security, and blockchain-based transferability, challenging Lee’s viewpoint that digital assets lack intrinsic worth.
Mixed Stance on Crypto ETFs and Stablecoins
Despite his skeptical tone, Lee acknowledged the FSC’s ongoing work on crypto exchange-traded funds (ETFs). While raising concerns about these products, he confirmed plans to collaborate with lawmakers to move the discussion forward.
Interestingly, Lee took a positive stance on stablecoins, emphasizing the importance of balancing innovation with proper safety measures. This aligns with South Korea’s push for a local currency-pegged stablecoin market, which mirrors similar efforts in Japan, Hong Kong, and China to maintain monetary sovereignty in the Web3 era.
What This Means for South Korea’s Crypto Future
Lee’s nomination comes as South Korea strengthens its regulatory framework for digital assets, including plans for stablecoin regulations and broader crypto oversight. While his critical view on Bitcoin and altcoins suggests a cautious regulatory approach, his support for stablecoin development signals an opportunity-driven strategy within controlled boundaries.
With global institutions and investors increasing crypto adoption, Lee’s stance could shape South Korea’s role in the evolving digital asset ecosystem—whether as a leader in stablecoin regulation or a conservative force in broader crypto markets.
Key Takeaways
- FSC nominee Lee Eok-won claims crypto has no intrinsic value, sparking industry backlash.
- He cited volatility as a barrier to crypto acting as money.
- Support for stablecoins indicates a strategic regulatory shift.
- South Korea continues exploring crypto ETFs despite concerns.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.