South Korea Contemplating Allowing Spot Bitcoin ETF, Says Financial Watchdog Chief

2024-03-05 00:19:48

Ruholamin Haqshanas

Last updated:

March 5, 2024 03:19 EST | 2 min read

Source: MidjourneySouth Korean authorities are discussing the potential approval of spot Bitcoin (BTC) exchange-traded funds (ETFs) in the country, as revealed by the country’s chief of the financial watchdog

Lee Bok-hyun, governor of the Financial Supervisory Service, said in a recent radio interview that there are differing opinions among authorities

While some, like himself, hold a positive stance on virtual assets, others are more cautious. Lee emphasized the need to consider all perspectives and engage in internal discussions.

“Among authorities, I am one of those who are positive about virtual assets, while there are others who are wary, and we need to hear their opinions as well. We are internally discussing it.”

Spot Bitcoin ETFs Not Available in South Korea

As of now, spot Bitcoin ETFs are not available for South Korean crypto investors

In January, the country’s financial authorities announced that they had no plans to regulate the sales of Bitcoin futures ETFs

However, they added that brokerage sales of spot Bitcoin ETFs were considered potentially in violation of the Capital Markets Act due to uncertainties surrounding Bitcoin’s qualification as an underlying asset.

Looking ahead, Lee said he hopes that the public will have an opportunity to express their views on the matter once virtual assets are brought under regulatory control in the second half of the year

This indicates a potential opening for dialogue and public input as South Korea navigates the possibility of allowing spot bitcoin ETFs.

The global interest in Bitcoin ETFs has been on the rise, with several countries already approving or considering their introduction

These investment vehicles offer investors exposure to bitcoin without the need to directly hold the cryptocurrency

If South Korea were to permit spot Bitcoin ETF sales, it could provide another avenue for investors to participate in the growing digital asset market.

Another U-Turn on Spot ETFs?

The recent news regarding the discussions around the potential approval of spot Bitcoin ETFs in the country come after the country’s ruling People Power Party said it indefinitely postponed its plans to ease crypto regulations.

Last week, it was revealed that the party has removed virtual assets from its list of policy priorities, effectively abandoning its plan to make a pledge to ease regulations

Previously, the People Power Party, led by Representative Yoon Chang-hyun of the National Assembly’s Political Affairs Committee, intended to announce a virtual asset pledge ahead of the general election scheduled for April 10

An official familiar with the party’s situation stated that the party leadership is currently focused on constituency nominations and personnel selection for the People’s Future, a proportional satellite party

The official further explained that starting in March, the party will prioritize election campaigns in each constituency, leaving little possibility for the announcement of virtual asset pledges in the remaining period.

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