South Korean regulators assessing Bitcoin ETFs, FSS governor imparts valuable perspectives
South Korean financial regulators are currently engaged in discussions regarding the possible introduction of spot Bitcoin exchange-traded funds (ETFs) in the country. Lee Bok-hyun, the governor of the Financial Supervisory Service (FSS), disclosed ongoing deliberations within South Korea’s regulatory bodies. In a recent radio interview, he highlighted the mixed opinions within the regulatory community regarding the approval of Bitcoin Spot ETFs. While some officials are more cautious, Lee expressed an optimistic stance towards virtual assets. The decision-making process is complicated by differing views within the regulatory community and concerns about how Bitcoin fits into current financial laws. Lee expects to involve the public in this matter, particularly given anticipated regulatory developments concerning virtual assets later this year.
The Financial Supervisory Service’s engagements extend beyond domestic dialogues. A formal consultation with the United States Securities and Exchange Commission (SEC) is scheduled for May, focusing on advanced financial instruments like non-fungible tokens (NFTs) and the classification of Bitcoin Spot ETFs as virtual assets within regulatory frameworks.
This discussion comes after the People Power Party in South Korea indefinitely postponed plans to relax cryptocurrency regulations, including the ban on domestic spot Bitcoin ETFs. Achieving consensus among government and financial institutions on cryptocurrency policy has proven challenging, leading to the delay.
Globally, interest in Bitcoin ETFs has surged, especially since the U.S. SEC approved the first spot Bitcoin ETFs on January 10. This decision prompted significant investments, as shown by recent data indicating a rise in U.S. Spot Bitcoin ETF inflows. On March 4, these inflows reached $588 million, with major financial institutions like Fidelity and BlackRock reporting inflows exceeding $400 million each. The Grayscale Bitcoin Trust was the only one experiencing notable outflows.
In addition to Bitcoin regulation, South Korean regulators are also intensifying their scrutiny of digital platforms due to privacy concerns. The country’s Personal Information Protection Commission announced an investigation into Worldcoin (WLD) on March 4 following reports of potentially illicit processing of personal information without consent, including iris data.
