SEOUL– South Korea’s financial regulator said Wednesday that fractional ownership in the copyrights of K-pop music is categorized as an investment, adding that proper measures must be put in place to protect investors.
Music Cow Inc., the country’s first music copyright trading platform, has drawn keen attention from many young people as they can buy and sell ownership in music copyrights that Music Cow holds in public auctions or on the platform. The company is currently preparing for an initial public offering.
With the Financial Services Commission’s new classification, a fractional ownership in copyrights is another type of investment vehicle, and the operator of Music Cow is required to draw up measures to protect investors.
Under the current system, investors in music copyrights hold a right to demand a profit or suffer a loss depending on the value of the music copyrights they hold or by selling or buying them.
Since its launch in 2016, the South Korean startup has grown fast, largely thanks to global interest from K-pop fans.
As of last year, the platform operator had 915,000 members, and its accumulated transactions totaled 274 billion won (US$222 million).
The regulator said such fractional ownership in copyrights of music, art and others has been on the rise recently, adding it will draw up new guidelines for such investment to protect investors.
Source: Yonhap News Agency