Crypto Takes Center Stage in Korea as Digital Assets Become Key Battleground in Elections

As South Korea prepares for its pivotal presidential election on June 3, 2025, cryptocurrency has emerged as an unexpected kingmaker in the campaign, with both leading candidates making bold promises to transform the nation's digital asset landscape.

The election, triggered by the impeachment of former President Yoon Suk-yeol, has crystallized around two main contenders who are competing to capture the attention of South Korea's massive crypto community. Lee Jae-myung of the opposition Democratic Party leads in polls against Kim Moon-soo of the governing conservative People Power Party, with Lee holding a clear advantage heading into the final day of campaigning.

A Crypto Nation Goes to the Polls

South Korea's embrace of digital assets has been nothing short of remarkable. With approximately 16 million citizens —about one-third of the entire population—actively trading cryptocurrencies, the country has established itself as one of the world's most vibrant crypto markets. The scale of this engagement is huge: trading volumes on major South Korean exchanges have at times exceeded those of the nation's traditional stock market.

The economic significance of this digital revolution cannot be overstated. According to Bank of Korea data, South Koreans held $74.5 billion worth of crypto assets by the end of 2024, representing a substantial portion of the nation's wealth. However, recent regulatory pressures have taken their toll, with Upbit, the country's dominant exchange, seeing volumes fall by 34% in Q1 2025 compared to the previous quarter.

Candidates Race to Embrace Digital Assets

Both frontrunners have unveiled comprehensive crypto-friendly platforms that could fundamentally reshape South Korea's financial sector.

Lee Jae-myung, the Democratic Party candidate has proposed the most ambitious crypto reform agenda, including legalizing spot cryptocurrency exchange-traded funds (ETFs), allowing the country's massive $884 billion National Pension Service to invest in digital assets, promoting the widespread adoption of Korean won-backed stablecoins, and streamlining regulations to prevent capital flight

Conservative candidate Kim Moon-soo has also committed to significant deregulation, promising to broaden access to digital assets and reduce regulatory barriers that have constrained the industry's growth.

Both candidates have specifically pledged to legalize and promote spot cryptocurrency ETFs, signaling a major shift in the country's financial policy landscape.

Timing is Everything

The crypto focus comes at a critical juncture for South Korea's digital asset industry. Korea Exchange revealed earlier this year that they are exploring crypto ETFs in 2025 following global demand for such products, while the country is set to allow institutional crypto trading by Q3 2025.

The push for won-backed stablecoins addresses a growing concern about capital outflows. Stablecoin flows accounted for 47% of South Korea's Q1 overseas crypto transfers, highlighting regulatory gaps that both candidates aim to address through domestic alternatives.

South Korea's election occurs against a backdrop of increasing global crypto adoption and regulatory clarity. The candidates' promises reflect a recognition that digital assets have moved from the margins to the mainstream of financial markets.

The winning candidate's ability to deliver on their crypto promises could determine whether South Korea maintains its position as a global crypto hub or loses ground to more regulation-friendly jurisdictions.