South Korea could soon follow Hong Kong in legalizing spot Bitcoin exchange-traded funds (ETFs), as the country’s top presidential candidates have expressed pro-crypto positions.
Still, some industry observers remain cautious about the likelihood of near-term regulatory change.
“All three major South Korean presidential candidates support #Bitcoin ETFs and institutional investment,” Ki Young Ju, the founder and CEO of onchain data platform CryptoQuant, wrote in a May 14 X post.
Currently, Bitcoin ETFs and institutional crypto investments are banned in South Korea, meaning that “100% [of the] volume comes from retail,” Ju added.
On May 6, South Korea’s Democratic Party leader Lee Jae-myung promised to legalize spot crypto ETFs, lower transaction fees and “create a safe investment environment so that young people can [build] assets and plan for the future, according to a report from The Korean Economic Daily (KED).
The Democratic Party made similar promises in its 2024 election campaign, including the legalization of spot crypto ETFs, but progress has been delayed, KED reported.
Candidates back ETFs, but history casts doubt
While the crypto-friendly perspectives of the leading candidates suggest a promising future for digital asset legislation in South Korea, regulation experts remain skeptical.
“The candidates’ pro-crypto pledges to push to legalize spot Bitcoin ETFs and reduce fees signal a potential shift. But history tempers optimism,” Anndy Lian, author and intergovernmental blockchain adviser, told Cointelegraph, adding:
“They will take on similar stances as Hong Kong. Whether the ETFs can perform or not depends on various other factors.”
“A pro-crypto president could drive reform, aligning South Korea with global trends like the US, where Bitcoin ETFs have attracted over billions in net inflows,” Lian said, adding that the Financial Services Commission’s tone also suggested “regulatory openness” for cryptocurrencies.
However, the People Power Party, elected in 2022, also promised to lift the crypto ETF ban and revise the controversial one-exchange-one-bank rule, “but failed to act before President Yoon’s impeachment,” Lian said.
Over in Hong Kong, the first batch of Bitcoin and Ether-based ETFs launched for trading on April 30, 2024, but saw disappointing trading activity compared to their US counterparts, Cointelegraph reported.
Source: https://cointelegraph.com/news/south-korean-presidential-candidates-support-bitcoin-etfs
Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.
Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.
An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.