South Korean Ruling Party Head Considers Approving Spot Crypto ETFs

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Sujha Sundararajan

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Sujha Sundararajan

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South Korea crypto ETF

South Korean government ruling party leader said Friday that his party would consider approving crypto-based exchange-traded funds (ETFs) after revisions.

Kweon Seong-dong, floor leader of the People Power Party (PPP), addressed during a meeting with government officials and heads of local cryptocurrency exchanges at the National Assembly in Seoul, March 7.

Per local reports, he stressed the need for “system improvements” to develop the crypto assets market. He added that the authorities will “review” these products and their trends worldwide, before implementing them.

“The government and the PPP will review global trends before considering the approval of the spot crypto ETFs, taking infrastructure and regulatory framework into account,” he told reporters Friday.

Further, Seong-dong emphasized that policies that consider “both user protection and market development,” are inevitable, given soaring crypto trading volume.

According to Bloomberg, from last Nov. 5-28, the daily average trading on Korean crypto exchanges amounted to about $9.4 billion. At the time, crypto trading was much bigger than the Korea Composite Stock Price Index or KOSPI at $7 billion.

This week, a new report revealed that South Korean regulators are keen to follow Japanese counterparts before granting approvals for Bitcoin ETFs.

FSC’s Ongoing ETF Approval Talks

The nation’s Financial Services Commission (FSC) has been in discussions regarding Bitcoin ETF approval since late last year. The regulator, however, expressed a cautionary approach to cryptos and in particular, BTC ETFs.

Recently, Korea Financial Investment Association Chairman Seo Yoo-seok highlighted that the nation has to embrace cryptocurrency ETFs to not lag behind global markets.

“While the virtual asset market is projected to continue its expansion, Korea should not be left out,” he noted.

Further, some South Korean financial chiefs claimed that the FSC is allowing rival nations to lead in crypto ETFs. Jung Eun-bo, chairman of the Korea Exchange (KRX), said last month that the country risks falling behind if it delays crypto ETF adoption.

“Cryptocurrency represents a sector capable of generating new value in the financial industry,” Jung stated. “We must not delay the introduction of cryptocurrency ETF trading.”

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