The Ministry of Startups and SMEs has picked Busan as a preferred candidate for becoming the nation’s first regulation-free blockchain zone.

South Korea’s largest port city is likely to be ahead of Jeju Island to become the zone.

Once Busan passes all screening procedures, it would become the zone in July.

However, the special zone would not get the right to allow initial coin offerings (ICOs).

Busan has 13 projects for running the blockchain zone. It would use blockchain in running its financial center, tourist sites, port, medical and logistic services.

The ministry indicated that Busan would not be the only zone. It hinted that the number of zones would be possible.

New minister Park Young-sun said the regulation-free zone would be thriving only when the local autonomous bodies are making efforts.

Busan officials said an exclusive blockchain zone would be a half-baked one unless ICOs gets permitted. However, the financial regulators are adamant against ICOs in South Korea.

Minister Park said South Korea has yet to define whether cryptocurrencies are property or not.

She urged Busan to issue its blockchain-based coins, including gift certificates. She hinted that it would take time before startups raise capital through ICOs.