On Thursday, Korea Stock Exchange Chairman Jung Eun-bo said he plans to “consider” approving a crypto-based exchange-traded fund (ETF) to continue the “value-up program” and compete with the ongoing market. revealed. assignment.
Korea Exchange to consider virtual currency ETF
January 2nd, Jung Eun Bo announced This year, the Korea Exchange plans to consider crypto-based ETFs at the 2025 Securities and Derivatives Market Opening Ceremony. The Chairman said that South Korea's capital market will face significant challenges in 2024, which will weaken the growth potential of domestic companies.
Chong also noted that global conflicts and domestic political developments have left the market “significantly underperforming compared to major economies.” The Korean market will continue to face risks in the new year due to “unfavorable economic conditions both domestically and internationally.”
Nevertheless, the chairman explained that the exchange will continue to pursue value enhancement programs to “partner with more leading companies and establish a management culture centered on shareholder value.”
Chung also revealed that the Korea Exchange will “benchmark overseas examples of new business instruments such as virtual currency ETFs and explore new areas in the capital market.”
It is worth noting that virtual currency ETFs have been banned in South Korea since 2017. The country's regulator, the Financial Services Commission (FSC), has reaffirmed its position after the US Securities and Exchange Commission (SEC) approved crypto-based investment products last year.
However, the financial watchdog announced in October that a newly established advisory group to discuss digital asset policy would review the ban, signaling a clear shift away from strict regulation. This change appears to be driven by the success of the Spot Bitcoin and Ethereum ETFs, which exceeded most experts' expectations in their first year.
South Korean political crisis blocks new regulations
The head of the Korea Exchange previously called for the institutionalization of virtual currencies in the country to “create added value.” Jeong argued that digital assets have grown in recent years and have great influence, and said that lawmakers and financial institutions need to look at digital assets differently.
The chairman added that South Korea should consider incorporating digital assets into institutional finance, as the market needs to be revitalized to compete with other countries.
The current stance of regulators on digital assets has prevented the market from moving beyond various regulatory standards over the years, creating challenges to market development and competitiveness. However, crypto-related regulations will be suspended until the political crisis is resolved, which could take several months.
In December, South Korean President Yun Seok-Yeol declared emergency martial law for the first time in 40 years. Yun accused the opposition Democratic Party, which has a majority in the National Assembly, of sympathizing with North Korea and anti-national activities.
The National Assembly voted to revoke the president's declaration, successfully ending emergency martial law in six hours. Since then, Congress has impeached Yoon and Prime Minister Han Do-soo, who became acting president after Yoon's powers were suspended.
According to the Associated Press reportSouth Korea's Presidential Security Bureau today prevented authorities from detaining Yun during a six-hour standoff at the official residence of the impeached president.
For this reason, the Anti-Corruption Agency plans to “strongly request'' Choi Sang-mok, acting director of the agency, to instruct him to comply with the execution of the arrest warrant.
The Constitutional Court is scheduled to decide whether to dismiss Yoon or reinstate him. At least six justices on the nine-member court would need to vote in favor of removing him from office.
Total crypto market capitalization is at $3.41 trillion in the one-week chart. Source: TOTAL on TradingView
Featured image from Unsplash.com, chart from TradingView.com
