Why NFT hype is skyrocketing in South Korea

South Korea’s fame as an innovator and top in technological research is joining into the blockchain empire as the Non-Fungible Token (NFT) adoption rate went high in the small East Asian country.

As of 2021, South Korea has been among the top-5 countries in the world in the Global Innovation Index (GII) with a score of 59.3.  With a high understanding of innovation made visible to global retail consumers by big tech companies such as Samsung and LG and to gamers through PUBG maker Krafton.

 Those companies and others are digging into the NFT space by dropping NFT collections to audiences and creating a new department focused on developing NFTs.

There might be a few reasons for the excitement to push the idea of NFT that more than just appreciation prize for a purchase.  This idea appeared by strategy lead at the KlayChicken NFT project, Alex Lim.  He told Cointelegraph on Money that “NFTs are all the rage but a lot of people don’t even know why.”

“The NFT hype in South Korea stems from a mixture of sentiments… I believe that in the second half of the year, the time will come when the whole South Korean NFT industry takes a quantum leap.”

One thing to notice is that there is a lack of a tax on digital properties in South Korea.  The crypto tax has been postponed until 2023, but president-elect Yoon Seok-yeol may postpone the crypto tax to 2024. 

In addition, NFTs are not regulated strictly as cryptocurrency is now.  Even though local financial regulators at the Financial Services Commission (FSC) are working on launching new NFT guidelines, none yet exist.  This led the market to be filled by new marketplaces at exchanges like Upbit and Bithumb and from Krafton to make profit from NFTs.

DeSpread GM Chung, who is co-founder and CEO at blockchain ecosystem accelerator DeSpread, believes that there will be more common use-cases of NFTs in South Korea.  He told Cointelegraph that “I expect NFTs to expand into a social on-chain profile layer along with transaction history in the future.” 

“Previously, the phenomenon of purchasing NFTs for community participation was done, but recently, the expansion of NFT utilities is considered to be a major reason (for its rise in utilization).”

President-elect Yoon Seok-yeol issued an NFT collection during the campaign.  Followers could  mint in order to support the candidate.

Source: CCCV

South Korea’s Hoseo University issued diplomas in NFT to its 2,830 graduating students on March 18. Local news Money Today reported in February that to improve availability and ease for students and prevent faking displomas, the university made a decision to issue NFTs.

The Ministry of ICT promised to support the development of a national metaverse with a $187.7 million dollar grant last month.  The new grant is expected to benefit the most toward content creators.

As the popularity of NFT increases, there is also increased demand for content creators to work on NFT projects.  JobKorea, a job search website in South Korea, shows 772 unique positions for content creators and business professionals by simply searching for “NFT”. 

The digital assets created by creators mostly in the form of in-game items or avatars, and emojis for texting apps.  Because Koreans are familiar with these digital assets, co-founder of crypto investment firm Stablenode Doo Wan Nam believes Koreans have adopted NFTs so willingly.  He told Cointelegraph Monday that “Koreans  are more open and understanding when it comes to NFTs, which is another form of [a] digital asset.”

According to Alex Lim, both content creators and businesses are starting to include NFTs in their business plans because of visibility of potential and utilities of NFTs.  He added that even though  it is avoidable to build a supportive community, it is one of the hard tasks for all content creators.

“NFTs have opened a new horizon for those who seek to materialize an ideal community where there is commitment, passion and autonomy.”