By
Bena Ilyas
May 17th, 2024
During the campaign, the Democratic Party of Korea promised to allow trading and listing of spot ETFs in the country to entice young voters to participate in the election.
The Democratic Party of Korea has revealed its plans to request the Financial Service Commission (FSC) to clarify the regulatory framework governing Bitcoin ETFs in the country. This move signals the party’s willingness to allow spot Bitcoin exchange-traded funds (ETF) in South Korea.
Fulfilling Election Promises: The Push for Bitcoin Spot ETFs
This request, which was made known via Blooming Bit, reported that an official from the Democratic Party stated that, in a bid to grant their election promises and pledges, the party aims to request an authoritative interpretation of spot ETF from the regulatory body after the 22nd national assembly. The statement reads:
“To fulfill our general election pledges, we plan to request an authoritative interpretation of the Bitcoin spot ETF from the financial authorities again after the 22nd National Assembly opens in June.”
During the campaign, the Democratic Party of Korea promised to allow trading and listing of spot ETFs in the country to entice young voters to participate in the election. The party eventually won the election; therefore, they have decided to fulfill the pledge they made. Currently, the country’s financial regulator FSC does not permit the issuance and trading of spot bitcoin ETFs, as no legal grounds support them as eligible underlying assets for ETFs under the Capital Markets Act.
Regulatory Hurdles: Seeking Clarification from Financial Authorities
The report revealed that, due to the 22nd National Assembly not being in session, there has yet to be any detailed discussion regarding implementing policies relating to the Bitcoin ETF. The newly elected party plans to submit another request to the Financial Services Commission for clarification on the spot ETF. Based on the response given, especially if unsatisfactory, the party will go on and initiate discussion on amending the Capital Market Act in the later part of the year; an adjustment to this act could lead to the approval of bitcoin ETFs in the country.
Although this push by the Democratic Party of Korea sounds like good news to crypto enthusiasts within the country, the process may not be as fast as expected. Should the nation’s top watchdog’s existing interpretation remain the same, it might lead to the formation of a new committee to look into the request. Several amendments and plenary sessions will be held, which could elongate the whole process by months or years.
Moreover, the push for Bitcoin spot ETFs in South Korea demonstrates the growing acceptance of the digital asset in various countries. Earlier this year, the United States announced the approval of the BTC ETF, and just last month, Hong Kong announced the approval of the BTC and ETH ETFs. Should this approval continue, it will encourage large institutions to invest in digital assets, allowing them to be legally tendered globally and; in fact, push the market price of these digital assets higher.