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Will Upbit's Regulatory Sanctions Come to an End? What Campaign Promises Did South Korea's New President Lee Jae-myung Make?

Foresight News

2025-06-04 14:32

Read this article in 24 Minutes

Three-time presidential contender finally reaches the summit, "grassroots politician" Lee Jae-myung elected as South Korea's new president, what promises did he make regarding Crypto and AI?

Original Article Title: "What Are South Korea's President-Elect Lee Jae-myung's Election Promises on Crypto and AI?"

Original Article Author: KarenZ, Foresight News

At 06:15 on June 4, the South Korean National Election Commission held a plenary session and formally confirmed the election of Lee Jae-myung, the candidate of the Democratic Party of Korea, as President based on the results of the 21st presidential election. Lee Jae-myung immediately began his presidential term. According to the Chosun Ilbo, in this presidential election, Lee Jae-myung won with a 49.42% vote share, while the People Power Party candidate Kim Moon-soo received 41.15% of the votes, and the Reclaim Party candidate Lee Jun-seok received 8.34% of the votes. With Lee Jae-myung's election as President of South Korea, the institutionalization of the South Korean digital asset industry is now a topic of great interest.

Why Did Lee Jae-myung Win the Election?

Lee Jae-myung's victory in this election can be attributed to several key reasons:

Firstly, former President Yun Seok-yeol triggered a constitutional crisis by briefly imposing martial law in December 2024, leading to his impeachment and removal from office in April 2025, sparking strong public outrage. This election saw a high voter turnout of 79.4%, the highest since 1997, reflecting the public's strong desire for political change. Following Yun Seok-yeol's impeachment, Lee Jae-myung promptly announced his candidacy for the presidency, leveraging this opportunity to actively engage in campaigning. He emphasized initiatives such as repairing relations with China, improving domestic economic and social issues, which garnered widespread support. As a progressive representative, Lee Jae-myung skillfully balanced the dual demands of "change" and "stability."

Secondly, Lee Jae-myung narrowly lost to Yun Seok-yeol in the 2022 presidential election, accumulating a strong political foundation and visibility. Additionally, Lee Jae-myung's personal political experiences and image have boosted his popularity. Coming from a poor background, he worked odd jobs after graduating from elementary school, later self-studying his way into a prestigious university to become a human rights lawyer, engaging in civil rights movements. These experiences established a deep connection with ordinary people, strengthening his support base. His "rags-to-riches" story resonated deeply with the lower strata of Korean society, reflecting their existential anxieties.

Furthermore, Lee Jae-myung's campaign platform directly addressed societal pain points, proposing initiatives to achieve diplomatic diversification, economic revitalization, focus on livelihoods, and promoting AI development and a crypto-friendly policy (such as advocating for a Bitcoin spot ETF, issuing a Korean won stablecoin), which gained significant public approval.

What Initiatives and Promises Has Lee Jae-myung Made in the Crypto Space?

During the 2025 South Korean presidential election, Lee Jae-myung and his Democratic Party of Korea representatives outlined various initiatives and commitments regarding Crypto, including promoting the drafting of the "Digital Assets Basic Law," institutionalizing Security Token Offerings (STOs), introducing a virtual asset spot ETF, advancing Korean won-based stablecoins, aiming to attract young voters, drive economic growth, and enhance the autonomy of the South Korean financial system through supporting the development of the digital asset market.

· Virtual Asset Spot ETF: According to the Korea Economic Daily, Lee Jaemyung proposed on May 6 to introduce a core youth policy commitment based on the establishment of a Virtual Asset Spot ETF (Exchange-Traded Fund) in South Korea. Lee Jaemyung pledged to "create a secure investment environment that allows young people to accumulate assets and plan for the future," including promoting the institutionalization of the Virtual Asset Spot ETF and building a unified regulatory system.

· Tokenized Securities: Lee Jaemyung committed to legislating and regulating tokenized securities. According to Yonhap News Agency analysis, the "Tokenized Securities Act" (Capital Market Act, Electronic Securities Act Amendment) was agreed upon between the ruling and opposition parties in the previous National Assembly session. Although its processing was delayed due to impeachment proceedings, it is expected to be smoothly passed after the current presidential election.

· Allowing National Pension Fund to Invest in Virtual Assets: According to Fnnews report, on May 17, Lee Jaemyung's campaign committee announced the establishment of a system for the National Pension Fund Association to directly invest in cryptocurrency. They stated that investments by the National Pension Fund and other pension funds in digital assets are not speculative but follow an internationally optimized model of controlled and scientifically diversified investment strategy. The committee emphasized that "ignoring digital assets due to emotional rejection will result in Korea falling behind in the global financial trend, losing monetary sovereignty, and missing out on opportunities for national asset appreciation—this is the real risk."

It is worth noting that according to the Yonhap News Agency, the National Pension Service of Korea (NPS) operating decision-making fund operation committee held its third meeting of the year on May 29, deliberated, and passed the "2026-2030 National Pension Fund Management Mid-Term Asset Allocation Plan." The core of this plan is to enhance the fund's profitability and stability, delay the outbreak of the pension deficit as much as possible, and primarily plan to reduce the proportion of domestic stock investments while expanding overseas stock and alternative investments. By the end of 2030, the target weights of each asset class are set at approximately 55% for stocks, 30% for bonds, and around 15% for alternative investments.

The committee also approved the "2026 National Pension Fund Management Plan (Draft)" reflecting the target proportions of each asset class by 2026. By the end of 2026, the target allocation proportions for each asset class are: domestic stocks 14.4%, overseas stocks 38.9%, domestic bonds 23.7%, international bonds 8%, and alternative investments 15%. According to the Korea Economic Daily, through pension reform involving increased insurance premiums, it is estimated that the accumulated fund size of the South Korean National Pension Fund will increase from the current 120 trillion Korean won (approximately 873 billion U.S. dollars) to 360 trillion Korean won (over 2.6 trillion U.S. dollars) by 2053.

This means that, based on the current size of the South Korean National Pension Fund, if the allocation to alternative investments reaches 15% by the end of 2026, there will be $130.95 billion available for investment in real estate, private equity, infrastructure, hedge funds, and other alternative asset classes. If the South Korean National Pension Fund were to venture into virtual asset investments, it could only be done as part of this category, and the proportion available for investing in virtual assets is left to our imagination.

It is worth noting that NPS also holds Coinbase and Strategy stocks. According to Yonhap News Agency's report in August 2024, NPS purchased 282,673 shares of Coinbase stock in the third quarter of 2023, bought around 245,000 MicroStrategy (now renamed Strategy) shares in the second quarter of 2024 for approximately $33.74 million (currently valued at $109.5 million), but sold 23,956 shares of Coinbase stock in the second quarter of 2024.

However, as reported by Money Today in September 2024, NPS explained that these stocks were not held for the purpose of virtual asset investment but were passively held because they were included in the benchmark index. The NPS Overseas Stock Investment mainly operates in two ways: passively tracking the MSCI (Morgan Stanley Capital International) index and entrusting asset management companies for individual stock investments. The NPS stated that the shares of Coinbase and MicroStrategy held were automatically purchased because they were included in the benchmark index or acquired through entrusted operations.

· Korean Won Stablecoin: Lee Jae-myung proposed the creation of a Korean Won-based stablecoin to curb capital outflows and enhance the stability of the South Korean financial system. According to the South Korean Asia Economic Daily, Lee Jae-myung stated in a policy discussion on May 8 that "to prevent national wealth outflows, a stablecoin market based on the Korean Won needs to be built." According to South Korean Democratic Party member Min Byeong-deok, data obtained from the Financial Supervisory Service on May 8 showed that the total amount of virtual assets flowing out of domestic exchanges in South Korea (non-net outflow) from January to March exceeded 56.8 trillion Korean Won, of which 47.30% (approximately 26.87 trillion Korean Won) was in USD-based stablecoins such as USDT and USDC.

However, Bank of Korea Governor Lee Chang-yeong stated at the end of last month that if non-bank entities were to issue a Korean won stablecoin, the effectiveness of monetary policy could be significantly undermined and it could potentially be used as a means to circumvent capital controls.

· Advancement of the "Digital Asset Basic Law" Draft: According to ChosunBiz, Lee is working with Democratic Party lawmaker Min Byeong-deok, who serves as the chairman of the Digital Asset Committee under the Lee In-myeong Campaign, to prepare the second-stage legislation of the "Digital Asset Basic Law." The focus is on operator registration and regulatory systems, defining disclosure and listing standards, and establishing a legal basis for self-regulatory organizations.

As reported by Fnnews, Democratic Party lawmaker Min Byeong-deok, who serves as the chairman of the Digital Asset Committee under the Lee In-myeong Campaign, and the Korea Enterprise Management Society held a joint seminar to ultimately gather expert opinions on the draft of the "Digital Asset Basic Law." Lawmaker Min Byeong-deok emphasized: "In the midst of a paradigm shift, if we concentrate resources, the Korean won stablecoin could be globally competitive. We need to unite our efforts to transform Korea from a passive recipient of the global order into an active designer in the era of digital assets." Lawyer Jin Haeng-eung from Pacific Law Firm pointed out: "When stablecoins issued overseas enter the Korean market, the regulatory targets must be clearly defined. Since the current Korean Electronic Financial Transactions Act does not cover virtual assets, virtual assets used as a means of payment need to be regulated in the 'Digital Asset Basic Law.' For example, if companies like Naver or Kakao provide stablecoins as a payment method, they must comply with this law."

· Reducing Transaction Fees: Lee In-myeong also proposed to "guide the reduction of transaction fees" by promoting fair competition between trading platforms to lighten the burden on users.

· Establishing a Comprehensive Monitoring System: To monitor unfair trading and fraudulent activities, enhance market transparency, strengthen investor protection, but is it overregulation?

It is worth noting that Lee In-myeong ran for president representing the Together Democratic Party in 2022 and utilized NFTs for fundraising. According to Digital Times, the fundraising goal of 35 billion Korean won was reached within 2 hours of the launch. According to Korea Central Daily, during the 2022 election campaign, Lee In-myeong also met with representatives of South Korea's four major cryptocurrency exchanges – Upbit, Bithumb, Coinone, and Korbit – promising to "accelerate the legalization of virtual assets," establish objective listing standards, improve disclosure mechanisms, monitor improper transactions, and gradually allow initial coin offerings (ICOs). Regarding ICOs, Lee In-myeong had suggested easing regulations. On that day, Lee In-myeong narrowly lost in the 2022 presidential election.

What Promises has Jae-myung Lee Made in the Field of AI?

Jae-myung Lee has also proposed a vision of "ascending to become one of the three major AI nations through AI transformation" and has promised to build a 100 trillion won public-private investment foundation. According to ZDNet, President Jae-myung Lee's official election pledges include the following plans:

· Substantially increase the AI budget to above the level of developed countries;

· Attract 100 trillion won in private investment;

· Establish an AI data center;

· Ensure at least 50,000 GPUs;

· Establish a national AI data cluster;

· Promote the "AI for All" project;

· Enact special regulations for AI-integrated industries;

· Strengthen future talent development education.

Who is Jae-myung Lee?

Early Life

Jae-myung Lee (이재명) is a highly influential political figure in South Korea. He was born in 1964 in Andong, North Gyeongsang Province, South Korea, to a poor family of seven children, where he was the fifth child. After graduating from elementary school, he entered the workforce at a young age to support himself. Due to being underage for legal employment, he had to work under a false name. During his work, his left wrist was unfortunately injured by a machine, leaving him with a 6th-degree disability. This challenging early experience became a vivid footnote in his political career of "resiliently fighting against fate."

However, the setbacks of fate did not break him. Subsequently, Jae-myung Lee studied on his own and took the high school equivalency exam to enter the law school of Chung-Ang University in South Korea. In 1986, Jae-myung Lee successfully obtained a Bachelor of Law degree and passed the judicial exam. He then opened his own law firm in Seongnam City and engaged in human rights and labor movements. During this period, he was greatly influenced by former President Roh Moo-hyun and gradually grew into a human rights lawyer. In 1995, Jae-myung Lee actively participated in civil rights movements and established the Seongnam Citizens' Association. In 2002, when two hospitals in Seongnam closed, Jae-myung Lee initiated a movement calling for the construction of new hospitals in the area. However, this demand was rejected by the city council. He led the people in protest but was wanted for obstruction of official duties. This incident became a crucial turning point in his political ideology—deeply realizing that fundamental social change could not be achieved solely through social movements, and substantive political participation was necessary to address the core issues. This ideological transformation laid a vital foundation for his formal entry into politics in the future.

Political Career

· Early Campaigns: He failed in his campaign for Mayor of Seongnam City in 2006 and was unsuccessful again in his bid for a seat in the National Assembly in 2008.

· Mayor of Seongnam City (2010-2018): Elected as the Mayor of Seongnam City in 2010, re-elected in the mayoral election of 2014. During his tenure, he paid off nearly 7 trillion KRW of the city's debt, implemented welfare policies such as free school uniforms and youth dividends, and opened part of the city hall building to the public, setting a precedent in Korean political history. However, controversy arose when he dissolved the Seongnam City short track speed skating team, indirectly leading to athlete Ahn Hyun-soo winning an Olympic gold representing Russia.

· Governor of Gyeonggi Province (2018-2021): Elected as the Governor of Gyeonggi Province in 2018 with 56.4% of the vote, he pursued policies such as "universal basic income." During the COVID-19 pandemic in 2020, amid the church leadership's refusal to cooperate with the government's investigation, he decisively raided the headquarters of Shincheonji Church, receiving public acclaim.

· Democratic Party of Korea Leader Election: In August 2022, he was elected as the leader of the Democratic Party of Korea. On June 24, 2024, Lee Jae-myung resigned from the party leader position, and in August 2024, he was re-elected with 85.4% of the vote. On April 9, 2025, Lee Jae-myung stepped down from his position as the Democratic Party of Korea leader to fully participate in the presidential race.

· Presidential Election: He announced his presidential candidacy in 2021 and ran as the Democratic Party's representative in 2022, narrowly losing to Yoon Suk-yeol with 47.83% of the vote (a difference of 0.73%). In April 2025, Lee Jae-myung officially announced his participation in the 21st South Korean presidential election as the Democratic Party's presidential candidate. On June 4, 2025, the South Korean National Election Commission held a plenary session and officially confirmed Lee Jae-myung's election as President based on the results of the 21st presidential election.