New South Korean Regulator ‘Could Speed Up Bitcoin ETF Verdict’

Bitcoin ETF South Korea

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Tim Alper

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Tim Alper

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Tim Alper is a British journalist and features writer who has worked at Cryptonews.com since 2018. He has written for media outlets such as the BBC, the Guardian, and Chosun Ilbo. He has also worked...

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October 12, 2024

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A new South Korean regulatory body is set to launch this month, with a ruling on Bitcoin ETF approval reportedly high on its agenda.

Per News1, the tentatively named Virtual Assets Committee could hold its first meeting “as early as this month.”

The new body will operate under the umbrella of the country’s top financial regulator, the Financial Services Commission (FSC).

Bitcoin ETF: On the Agenda?

The media outlet said that the body’s launch would help “discussions on issues such as approving Bitcoin and Ethereum spot ETFs “gain speed.”

Industry insiders were also quoted as stating the committee is also expected to discuss “allowing corporate virtual asset investment.”

Several South Korean companies are hopeful of following American and Japanese companies into the Bitcoin, Ethereum, and altcoin investment sectors.

A South Korean financial sector expert told Cryptonews.com earlier this year that “more than one major” domestic company wants to know if Seoul will let firms buy BTC with their balance sheets.

The same expert, who spoke on condition of anonymity, said some companies “may also look to invest in ETH” if they are given permission.

Despite industry pressure and pressure from lawmakers, however, the FSC has repeatedly delayed discussions over Bitcoin ETF approval.

The media outlets quoted anonymous crypto industry insiders as stating that the body is also set to talk about “second-stage” crypto legislation.

“Kickoff Meeting” Slated for This Month

The same insiders said that the financial authorities “plan to finalize” the committee’s membership before the end of October.

They also want to “hold a kickoff meeting” before the end of this month.

The committee’s legal framework was established under the terms of the Virtual Asset User Protection Act, which came into force in July.

The FSC has already appointed its own Vice Chair, Kim So-young, as the new commission’s head.

A further five regulatory or governmental officials will sit on the commission, which will consist of a total of 15 members.

These five officials will be drawn from the following ministries:

• The Ministry of Economy and Finance
• The Ministry of Justice
• The Ministry of Science

The remaining nine members will be drawn from the “private sector,” the media outlet reported.

The FSC this month underlined its stance that no Bitcoin ETF decision would be made until the commission’s launch.

The top regulator’s most recent audit report also noted that the body would tackle the issue of “corporate virtual asset accounts.”

‘Let Companies Buy Crypto’

News1 noted that political and industry leaders have made “continuous calls for corrective action” as US-based firms launch Bitcoin ETFs and buy BTC.

Last week, the Financial Services Commission Chairman Kim Byung-hwan attended a National Assembly meeting. At the summit, Kim talked up the new Virtual Asset Committee.

However, lawmaker Lee Kang-il, of the main opposition Democratic Party said:

“In the past, the domestic [crypto] market had an advantage in competitiveness [over its international counterparts]. But that is no longer the case now.”

But Kim responded that regulators intend to “balance” the need to “protect” crypto investors and the desire to spark crypto sector growth.

Don’t Play Squid Game With Domestic Exchanges – Lawmaker

“I think we need to strike a balance between [investor] protection and fostering [the crypto market]. Since there is much to do in terms of improving the system, we will form a Virtual Asset Committee. Its members will comprise private sector experts. And this body will look into the matter comprehensively.”

Financial Services Commission Chairman Kim Byung-hwan

Lee, meanwhile, also hit out at the FSC, accusing it of “playing Squid Game” with domestic crypto exchanges.

He said that regulators were allowing Upbit to create a monopoly and leaving its exchange rivals to “die off.”

Kim said he was “aware” of these accusations. He promised that the FSC would “look into the matter.”