Korea’s ban on ICOs needs to be eased or reversed in the coming months

Asian Innovations Group CEO and co-founder Andy Tian responds to a question in a recent interview held at the group’s head office in Seocho-gu, southern Seoul. Courtesy of Access Communications and Consulting.

Korea’s ban on initial coin offerings (ICOs) needs to be eased or reversed in the coming months given the growing importance of blockchain technology, a system for secure and distributed database of transactions, according to co-founder and CEO of Asia Innovations Group Andy Tian.

“Even if policy is negative at this moment, there will be reasonable policy coming out this year just like U.S. regulators approved restrictions and then allowed ICOs,” Tian said in a recent interview.

The group has Gifto as its flagship product. Gifto was the fastest-selling ICO in Asia. It is add-on to the virtual gift-giving mechanism Uplive. Launched in 2016, Uplive is a livestreaming service allowing users to broadcast or watch real-time videos on their smartphones.

Tian, an MIT graduate and a former Google engineer, said most ICOs should be regulated. “Regulation is a good thing for proper tokens like us,” he said. “Most American companies are afraid of tokens right now, and that’s why new companies are doing ICOs.”

Korean financial regulators decided to ban ICOs, warning that they were causing money to “flood into an unproductive and speculative direction.” While Korea has still left its “No ICOs” policy unchanged, working-level discussions are underway with the country’s tax agency, justice ministry and other relevant government offices to allow ICOs in the future with taxes imposed.

The government didn’t enforce a complete ban and Koreans remained able to invest in foreign ICOs. Seoul confirmed its interest in the emerging blockchain technology supporting cryptocurrency transactions, prompting steps to reverse measures taken to cut the fervor for crypto-assets.

Tian said Korea is “fascinating,” describing the country as the “intersection of different major trends.”

“Our main platform is a livestreaming platform service. Korea is the oldest livestreaming country in the world. Also, the entertainment industry in Korea is influential across the world, while the country is also the biggest crypto-trading spot.”

What he found interesting during his visit to Korea is that 50 percent of new blockchain-based products in the country are based on a “reverse ICO” (RICO).

“RICO means companies with existing businesses offering tokens and I heard this term first in Korea,” he said. “It will be a huge trend in 2018.”

How can he be so confident? As a CEO, he brings a wealth of “traditional” gaming experience to the table. Previously, he was head of Zynga China, where he learnt the business of gaming.

He has also looked at the issues on how to monetize content through RICOs.

“A lot of companies like music, content and payment come to us for getting advice regarding tokenization on existing business. Unlike current technology-focused products that don’t have any user base and taking a long time to deploy, RICOs will bring blockchain technology benefits to users and the mass market much faster,” he said.

“Because RICOs are running real businesses that need commercial-grade technology, for example, faster and more stable transactions, they will also help to push forward blockchain tech development.”

When asked for more details of Uplive, which now boasts 35 million users from 50 different countries, Tian said his company will offer customized virtual gifts to suit the content creator.

For payouts in Uplive, there’s no advertising. Instead fans of broadcasters can how their love through sending virtual gifts. “Giving a virtual gift is an emotional connection or reaction by fans. I just want to say this is a very personal experience.”

Tian said the group has no imminent plans for partnerships with Kakao or Naver. “We are very new but innovative. We will consider lots of tie-ups when conditions are met. Partnerships with large companies is not our primary goal.”