South Korea’s financial watchdog is reportedly set to review the approval of spot crypto ETFs and the legalization of corporate crypto accounts through a newly formed committee.
South Korea, which has been cautious in its approach to crypto regulation, is now considering the approval of spot crypto exchange-traded funds and corporate crypto accounts through its newly established Virtual Assets Committee.
According to a News1 Korea report on Oct. 10, the committee, chaired by the Financial Services Commission’s vice chairman, will include representatives from several government ministries and private-sector experts. While Bitcoin (BTC) and Ethereum (ETH) have secured approval from regulators for spot ETFs in the U.S. and Hong Kong, South Korea has yet to allow such products, and corporate crypto accounts remain prohibited.
However, the report does not indicate a specific timeline for when South Korean authorities will review the approval of crypto ETFs.
South Korea speeds up with crypto regulation
The move comes as the Korean regulatory body faces mounting calls for reform in these areas as the domestic crypto market evolves. Currently, the FSC is processing renewal applications for virtual asset service providers that first registered in 2021, as the regulator pushes amendments to the Specific Financial Information Act, designed to enhance oversight of market manipulation and unfair trading practices, the report notes.
The FSC reportedly also indicated it is considering “Phase 2 legislation,” which would focus on tighter regulatory controls for crypto businesses, such as issuance and listing requirements, following the recent enactment of the Virtual Asset User Protection Act, introduced in July.
South Korea has been gradually expanding its crypto oversight, focusing on balancing market growth with investor safeguards. As a result, major domestic crypto trading platforms, such as Upbit, have come under increased scrutiny, with the FSC recently investigating the exchange’s dominance and ties with K Bank.
Upbit, which holds around 80% of the local market, is the country’s largest crypto exchange and ranks fifth globally by 24-hour trading volume.