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Cryptocurrencies excluded from new South Korean donation law
Last updated: May 5, 2024 11:00 pm EDT | 2 minute read
Cryptocurrencies, including Bitcoinwill be excluded from a change to South Korea’s donation law, government officials announced on May 5.
For Kyunghang Shinmunthe Ministry of Interior and Security said it wanted to “expand the scope” of donations, but decided not to allow citizens to donate cryptocurrencies.
Donation plans: cryptocurrencies excluded
The ministry plans to make changes to the decree implementing the law on the collection and use of donations.
These amendments will allow citizens to donate a variety of alternative cash to charitable causes.
These include loyalty points from tech giants like Naveras well as department store gift cards, stocks, supermarket coupons and listed stocks.
The ministry also plans to allow citizens to donate stablecoins issued by the local government and pegged to the KRW and blockchain-based e-gift cards.
The plans also expanded the reach of donation platforms, with more online donation options given the green light.
Citizens will also be able to use Automatic Response Systems (ARS) technology when they want to donate to charities.
Ministry officials want lawmakers to approve the legal changes in time for the launch in July.
The ministry did not give reasons for its decision not to allow citizens to donate cryptocurrencies, despite the decision huge popularity of BTC and other tokens in the country.
Charities to suffer?
The news will be a blow not only to cryptocurrency enthusiasts, but also to South Korean charities.
In recent years, charities have tried to launch cryptocurrency-based donation initiatives. But they had to deal with legal obstacles.
South Korean law does not allow charities to accept cryptocurrency donations. Thus past campaigns have relied almost entirely on help from national exchanges.
In an article from January 2024 for Bokji TimesJang Yoon-ju, a researcher for The Beautiful Foundation, one of South Korea’s largest charities, has documented the cryptocurrency-related challenges charities face in the nation.
He said potential donors had “asked questions about cryptocurrency donations.” But, Jang said, such questions were often “difficult to answer.”
Exchanges play a key role
Jang noted that various attempts to launch cryptocurrency-based donation platforms had failed in the past, with notable initiatives in 2014 and 2018 ultimately coming to nothing.
He added that donations made using cryptocurrencies began “in earnest” in 2020, when four large national charities began encouraging the public to donate their tokens.
But in each case, charities have had to partner with cryptocurrency exchanges that convert the coins into cash, which they then pass on to the organizations.
Growing Popularity of Cryptocurrency Donations in South Korea?
The researcher added that cryptocurrency donations are becoming increasingly popular in South Korea, with many looking to donate their coins to overseas charities.
Jang explained that South Koreans donated a total of 14 BTC to charities involved in providing aid to victims of the 2023 Turkey-Syria earthquakes.
Citizens made their donations via a platform managed by Dunamuthe creator of Upbit exchange leader of the South Korean market.
It also said that last year 902 South Koreans donated “digital assets” worth about $118,000 to charities helping refugees from the war in Ukraine.
The Ukrainian government has also created direct cryptocurrency donation platforms for international donors.
Last year, Russian officials has accused a man who allegedly sent cryptocurrencies to the Ukrainian military of “high treason.”