Legal Review Opinion on Domestic P2E Service for Overseas Token Projects

Client Information

Corporate / Party
 

Case Details

Decent Law Firm was commissioned by an overseas cryptocurrency foundation to provide a legal review opinion on its token project, particularly regarding its Play-to-Earn (P2E) services in South Korea. The token project aimed to list its tokens on domestic cryptocurrency exchanges, necessitating a legal evaluation of the token’s securities classification and potential regulatory concerns related to P2E services under South Korean law.

The review focused on whether the P2E service might violate local regulations and how such risks could impact the token’s listing process.

Through its comprehensive analysis, Decent Law Firm identified potential risks of the P2E service violating the prohibition against gambling-like activities under South Korea's Game Industry Promotion Act. However, the analysis also concluded that these concerns might not directly affect the token’s eligibility for listing.

To mitigate uncertainties and regulatory challenges, Decent recommended the following measures:

1. Restrict Domestic P2E Services
Decent suggested limiting the availability of P2E services in South Korea, instead providing a general version of the service that avoids regulatory pitfalls.

2. Clarify in the Whitepaper
The team advised clearly stating in the project’s whitepaper that P2E services would not be offered domestically. It was recommended to emphasize that only non-gambling general services would be available in South Korea, reducing regulatory risks.