South Korean company filed complaint claiming government ICO ban unconstitutional

09 Dec, 2018 | Updated: 09 Dec, 2018
by Fifi Arisandi
Regulation
South Korean company filed complaint claiming government ICO ban unconstitutional

A South Korean court has reported the filing of a constitutional complaint from a crypto company claiming that the government’s ban to ICO is unconstitutional.

A South Korean blockchain startup, named Presto recently filed a complaint related to the government’s ban against all forms of Initial Coin Offerings (ICOs).

The complaint claimed that the ban enforced starting September last year as unconstitutional, as explained by their lawyer, Park Ju-Hyun, who based the claim on two grounds.

First and foremost, he said the ban infringes “the basic rights of the Constitution”, such as “freedom of occupation, right to property, [and] right to equality”.

Secondly, he stated that the basic restrictions were imposed without legal basis, on which he cited Article 37 (2) of the Korean Constitution.

Park referred to the recent case where the court ruled in favor of crypto exchange, Coinis, whose transactions were blocked by the country’s largest bank, Nonghyup Bank.

He stated his agreement towards the court’s decision and said that the bank’s action was done without a legal basis, thus it’s deemed illegal.

Presto’s CEO, Kang Kyung-Won explained to the media that despite the options the company has, such as setting up an overseas corporation to issue tokens, his company still has faith towards the government.

Quoting his statement, “We trusted that the government will foster [this] new industry through follow-up measures.”

However, since it’s been more than a year since the ban was enforced without any official guidelines or regulations towards ICOs yet thus far, he began questioning the government’s "policy".

“As a blockchain startup company, we face a great deal of difficulties due to the ICO ban and the lack of legislation from the government and the parliament for more than a year. I am requesting confirmation of the unconstitutionality of the lack of legislation,” Kang said as reported by News Bitcoin.

Despite the government's "unclear policy" towards ICO, the crypto industry's growth in the country is still very promising.

Just yesterday, Chepicap reported that South Korean exchanges showed bigger number than those located in the crypto island country, Malta in terms of average daily crypto transaction volume.

The country also announced last week their plan to create a cryptocurrency tax, as a way to keep their position as the frontrunner in international blockchain adoption.

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Read more about: South Korea ICO

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