[In-Depth Look] BTS, K-Culture, and K-Fintech

Geunju Lee, President of the Korea Fintech Industry Association

Last year, the trade deficit in intellectual property rights recorded its lowest level since being included in the statistics. This is likely due to the global syndromes of the group ‘Bangtan Sonyeondan (BTS)’ and the Netflix drama ‘Ojingeo Game (Squid Game),’ which helped push last year’s Hallyu-related export value close to 15 trillion won, significantly increasing the surplus in cultural and artistic copyrights. In this way, K-Culture content has been recognized for its competitiveness in the global market and has established itself as a new growth engine for the Republic of Korea.

For K-Culture, which is dominating the world, to not be just a temporary hit but to firmly establish itself as a new growth industry in Korea and continue to grow, persistent efforts and support are needed in various areas.

Fair and appropriate compensation for content creators, healthy cultivation and management of fandoms, and institutional and financial support measures for cultural enterprises must be solidly built to strengthen the infrastructure of the cultural industry.

Recently, cases demonstrating the potential to expand the economic and social infrastructure of K-Culture through value sharing mediated by ‘investment’ between cultural suppliers and consumers have appeared in the realm of K-Fintech.

Fintech platforms such as Music Cow, a music copyright trading platform, and Art Together, an art-tech (art + finance) platform for joint art purchases, have emerged, allowing the general public to invest in cultural creators and content that were previously difficult to access. These platforms connect cultural suppliers and consumers through finance and are expected to ultimately contribute to the creation of a sustainable ecosystem for K-Culture.

The fundamental role of finance is to support the real economy. Just as securities are issued and traded in capital markets represented by stocks and bonds to raise funds necessary for corporate business activities, the era of so-called ‘cultural innovation finance’ has opened, which mobilizes funds to support creators’ creative activities and fosters related ecosystems.

Fintech is now evolving beyond merely changing and upgrading existing finance; it is creating unprecedented markets and new value chains in fields beyond finance, becoming a true pioneer of the digital economy era.

Recently, financial authorities recognized the first case of investment contract securities and announced guidelines related to new asset types such as fractional investment, emphasizing investor protection. It is expected that new digital assets traded among many market participants in the future will be subject to basic securities regulations, including investor protection.

Of course, the market may not welcome the expanded application of regulations, but it is also important that the inclusion of new industries within the regulatory framework can serve as an opportunity to secure business continuity.

No matter how good the goals and benefits of fintech innovation are, fintech companies must prioritize ‘Responsible Innovation’ as their core value as members of Korea’s financial ecosystem.

As seen in incidents like the Merge Point case, innovation without investor protection is unsustainable. To gain market trust, robust safety measures for investor protection must be established alongside service innovation.

On the 15th, major global media outlets such as The New York Times, CNN, and BBC prominently featured the news of the group Bangtan Sonyeondan (BTS) temporarily suspending group activities. It has become an era where Korea’s status and national dignity depend on cultural warriors, and Hallyu is still ongoing.

We hope that financial authorities will actively respond to the voices of K-Culture content creators and countless ‘Army’ fans who need cultural innovation finance by designing regulations suitable for the digital age, allowing the individuality and innovation of K-Fintech to shine.

We eagerly look forward to the birth of the second and third BTS on the foundation of cultural innovation finance built by fintech.