[Column] The Paradox of Protection: Tada, Public Certification, and Stablecoins

The “protection paradox,” where systems intended to protect industries actually lead to weakened competitiveness, has repeatedly played out in different eras.

The U.S. Jones Act, enacted in 1920 (a law that restricts U.S. coastal shipping to U.S. vessels), was originally intended to protect the domestic shipping industry; however, it has been criticized for increasing costs and inefficiencies, which are seen as undermining competitiveness. Recently, there has even been discussion about relaxing this law.

South Korea’s recognized certification system has also followed a similar trajectory. Under the guise of safety, it has solidified specific certification methods into de facto standards, hindering diverse technological competition. As a result, it has led to dependencies on ActiveX and operating systems, creating a closed ecosystem where user experience and technological innovation have been relegated to secondary importance.

The mobile transportation industry has experienced the same scenario. Tada had rapid growth but was expelled from the market due to the so-called “Tada prohibition law.” Although it has since received a series of not guilty rulings, the tide of innovation has already been interrupted. When the court raised its support for innovation, the market structure had already solidified. Protection remains, but competition has been lost.

Today, the debate has shifted to stablecoins. The Bank of Korea emphasizes a bank-centered issuance structure, while financial authorities and some politicians advocate for a more flexible approach. The focal point of the controversy is not simply the intensity of regulation, but rather the difference in perspectives: whether to view stablecoins as objects of financial control or to acknowledge them as part of digital infrastructure.

The issue lies in speed. As the direction of regulation remains unclear, the structure reliant on overseas stablecoins is becoming increasingly solidified. Technology spreads without borders, while systems still cling to boundaries. Just like in the era of recognized certification, we may again drift away from the tide of innovation.

Protection can safeguard industries. However, the moment protection replaces competition, innovation will come to a standstill. The antonym of protection is not laissez-faire, but competition. Protection without competition will ultimately lead to decline. What is needed now is not to build higher walls, but to create an environment that can become stronger within those walls.