South Korea Stands Firm on Crypto ETF Ban Despite US Approval
Date: 2024-01-12 Author: Dima Zakharov Categories: IN WORLD
South Korea has reaffirmed its stance on banning cryptocurrency exchange-traded funds (ETFs), despite the recent approval of spot Bitcoin ETFs in the United States. The country currently restricts local financial institutions from holding or trading cryptocurrencies, as well as investing in businesses offering cryptocurrency services. The decision was reiterated by South Korea's chief financial regulator, who stated that financial institutions would not be allowed to launch crypto exchange-traded funds, as reported by local media outlets.
A representative from the country's Financial Services Commission told the local news outlet Kyunghyang that the approval of spot Bitcoin ETFs in the United States was not a triggering event for the South Korean regulator to lift or reconsider the ban. The report cited financial market stability and investor protection as the reasons behind maintaining the existing restrictions.
The country's Capital Markets Act currently limits the scope of underlying assets for securities investment contracts, such as ETFs, to traditional financial instruments, currencies, and commodities, excluding cryptocurrencies. South Korea does not recognize cryptocurrencies as financial assets and has prohibited financial institutions from investing in them since 2017.
