In the global race to become the next major cryptocurrency and blockchain epicenter, Asian cities are stepping into the spotlight. Following the success of Singapore and Hong Kong, Busan, South Korea’s second-largest city and a major port in Northeast Asia, is rapidly gaining traction as a preferred destination for leading crypto enterprises.
Backed by proactive local policies and a tech-savvy population with one of the highest cryptocurrency adoption rates in the world, Busan is positioning itself as a key player in the digital finance revolution. With major exchanges like Binance, FTX, and Huobi establishing strategic partnerships in the city, and high-profile blockchain figures like Justin Sun expanding their presence, Busan is not just riding the wave—it’s helping to create it.
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Why Busan Is Attracting Global Crypto Players
The momentum behind Busan’s rise began gaining real shape in September 2022 when Mayor Park Hyung-joon announced an ambitious plan: to transform Busan into a blockchain-specialized city and a global digital financial hub. This vision is more than political rhetoric—it's backed by concrete actions.
In late October 2022, Busan Blockchain Week took place, drawing international attention as one of Asia’s largest blockchain events outside of Singapore’s Token 2049. The summit attracted top-tier participants, including Binance, FTX (at the time among the top two exchanges globally by volume), and Huobi—recently acquired by HashKey Capital.
What sets Busan apart isn’t just its geographic advantage as a port city, but its pro-innovation regulatory environment. In 2019, the South Korean central government designated Busan a blockchain regulatory-free zone, allowing for pilot projects in digital assets, decentralized finance (DeFi), and blockchain-based public services—all within a controlled legal sandbox.
This blend of government support and local initiative has created fertile ground for blockchain innovation.
South Korea’s Surprisingly High Crypto Adoption Rate
While cities like Singapore and Hong Kong have long been financial gateways, South Korea stands out due to its extraordinarily high retail participation in cryptocurrency.
According to data from the Financial Services Commission (FSC) of South Korea, there were approximately 15.25 million virtual asset users in the country by the end of 2021—with 5.58 million actively trading. Given that South Korea’s total population is around 51.74 million, this means over 10% of the entire population engages with digital assets.
Even more telling is the demographic breakdown: 58% of these users are between 30 and 40 years old, suggesting deep integration of crypto into mainstream financial behavior among working-age adults. Analysts often cite that one in five young Koreans owns some form of cryptocurrency, highlighting a cultural openness to digital finance.
At the height of the mining boom, reports revealed that nearly 20% of internet cafes in South Korea were repurposed for cryptocurrency mining, sometimes closing to the public to maximize uptime and profits. This grassroots enthusiasm signals not just speculative interest, but a broader technological embrace.
From Crackdowns to Controlled Embrace: South Korea’s Evolving Crypto Regulation
South Korea’s journey with cryptocurrency has not been smooth. Initially wary of risks like money laundering and market manipulation, regulators took strict stances:
- In September 2017, the FSC banned all forms of Initial Coin Offerings (ICOs).
- By December 2017, financial institutions were prohibited from engaging in crypto-related activities.
- In 2018, virtual asset businesses faced a 24.2% corporate and local tax rate, alongside mandatory real-name trading accounts and classification of crypto as a high-risk factor for money laundering.
However, regulatory attitudes began shifting around 2020:
- In January, the Presidential Committee on the Fourth Industrial Revolution recommended allowing financial institutions to offer Bitcoin derivatives.
- In March 2020, the National Assembly passed the Special Financial Transaction Information Act, requiring crypto exchanges to register with the FSC, implement KYC/AML procedures, and comply with anti-money laundering laws—failure to do so could result in criminal penalties.
This marked a pivotal shift: instead of suppression, South Korea chose regulated inclusion.
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Major Exchanges Bet Big on Busan
With regulation clarifying and demand surging, global players moved quickly to establish a foothold in Busan.
Binance: Building a Blockchain Ecosystem
On August 26, 2022, Binance signed a Memorandum of Understanding (MoU) with Busan City to support the development of the Busan Digital Asset Exchange (BDAX). Under this collaboration, Binance provides technical infrastructure and expertise to help build a secure, scalable trading platform tailored for institutional and retail investors.
Mayor Park emphasized that this partnership aims to “make Busan a globally recognized blockchain city” and “a new engine for local economic growth.”
FTX and Huobi Join the Charge
Just days later, on August 30, FTX entered into a commercial agreement with Busan to support the establishment of a local crypto exchange. The plan includes joint educational initiatives with Pusan National University to train future blockchain talent.
Then on September 23, Huobi Global and Huobi Korea signed a similar deal to co-develop BDAX and advance blockchain industry growth. Huobi also announced plans to relocate its Seoul headquarters to Busan by year-end—a significant vote of confidence in the city’s potential.
Tron’s Expansion into Gaming and Stablecoins
Beyond exchanges, ecosystem builders are also moving in. Justin Sun, founder of the Tron blockchain, has long had ties with South Korea. In 2019, Tron partnered with Samsung to enable TRC-20 token support in Samsung’s built-in blockchain wallet.
In September 2022, Sun announced further expansion at Korea’s largest blockchain event: Tron plans to open an official Korean office in early 2023, focusing on gaming, DeFi, and stablecoin applications. He praised Korea as “one of the most active crypto markets globally” and expressed strong interest in collaborating with local game developers on Web3 integration.
Regulatory Challenges Remain
Despite Busan’s progress, challenges persist—particularly at the national level.
The collapse of Terra (LUNA) in May 2022 cast a shadow over Korea’s crypto ambitions. As the algorithmic stablecoin project was founded by Do Kwon, a South Korean entrepreneur, the fallout led to massive investor losses and global scrutiny. Korean prosecutors launched investigations and sought an Interpol Red Notice for Kwon.
In response, national regulators adopted a more cautious stance toward crypto innovation. Some planned initiatives were delayed or reevaluated.
Yet Busan continues pushing forward—leveraging its status as a regulatory-free zone to pilot new models while adhering to core compliance standards.
What’s Next for Busan?
As of 2025, over 20 foreign blockchain firms have signed investment agreements with Busan, with more than half planning to move their regional or global headquarters to the city. Visits from industry icons like CZ (Changpeng Zhao) and Vitalik Buterin have further validated its growing influence.
Core keywords driving this transformation include:
Busan crypto hub, blockchain regulatory sandbox, South Korea crypto adoption, digital asset exchange, crypto-friendly cities, Binance Busan partnership, Tron Korea expansion, and global digital finance center.
The city is no longer just a port for shipping containers—it’s becoming a gateway for digital value.
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Frequently Asked Questions (FAQ)
Q: Why is Busan becoming a popular destination for crypto companies?
A: Busan offers a supportive regulatory environment as a designated blockchain special zone, strong government backing, high local crypto adoption, and strategic partnerships with major players like Binance and Huobi.
Q: Is cryptocurrency legal in South Korea?
A: Yes. While ICOs remain restricted, owning and trading cryptocurrencies is legal. Exchanges must comply with strict AML and KYC regulations under the Special Financial Information Act.
Q: Are U.S.-based exchanges like Coinbase active in Busan?
A: As of now, Binance, FTX (pre-collapse), and Huobi have taken lead roles. While Coinbase hasn’t announced specific plans for Busan, the city remains open to international platforms meeting compliance standards.
Q: How does Busan compare to Singapore or Hong Kong as a crypto hub?
A: Unlike Singapore and Hong Kong, which focus on institutional finance, Busan emphasizes grassroots innovation through regulatory sandboxes and public-private collaboration—making it ideal for pilot projects and ecosystem development.
Q: Can foreigners start a crypto business in Busan?
A: Yes. The city actively courts foreign blockchain firms through incentives and streamlined registration processes within its regulatory-free zone framework.
Q: What role does education play in Busan’s blockchain strategy?
A: Education is central. Partnerships with Pusan National University aim to develop certified blockchain curricula and train a new generation of developers, entrepreneurs, and regulators.