South Korea’s ruling party i.e., People Power Party announced a comprehensive seven-point plan aimed at accelerating the country’s role in the global crypto economy. The proposals include legalizing spot crypto ETFs, and also relaxing restrictions on banking partnerships for exchanges. The party has also proposed laying the groundwork for institutional investment in the virtual asset market.
South Korea: Crypto Policies, Crypto Spot ETF On the Way?
At the core of the reforms is a plan to allow spot ETF trading of cryptocurrencies like Bitcoin within the year—an anticipated move that would align South Korea with markets such as the US, UK, and Hong Kong, where similar products have already been launched. A spot ETF directly tracks the price of cryptocurrencies by holding actual digital assets, making it a favored structure among investors seeking exposure without holding tokens directly.
“The global race is on, and Korea cannot afford to fall behind,” said Rep. Park Soo-min, referencing the growing interest in spot ETFs following the SEC’s approval of Bitcoin ETFs in the US
Among the key policy changes is the dismantling of the “1 exchange-1 bank” rule, a regulatory bottleneck that has limited crypto exchanges to partnerships with a single bank. The party stated this restriction has deterred healthy competition and institutional access. The revised framework will allow corporations (including nonprofits, listed companies, and investment firms) to participate in crypto markets more freely, with institutionalization expected for 3,500 organizations within the year.
The party also promised to introduce stablecoin regulations in accordance with international standards, and support legislation around Security Token Offerings (STOs). It has also promised to introduce a fundamental law for cryptos, and establish a new taxation regime tailored for small investors.
Rep. Choi Bo-yoon emphasized the importance of balancing between investor protection and market growth, stating that tax reforms would reflect the realities of Korea’s particularly retail investor base. He also hinted at relaxing cross-border restrictions as soon as anti-money laundering security is in place, potentially opening Korean crypto markets to international users.
The People Power Party also plans to create a dedicated crypto committee under the presidential candidate’s office to materialize these plans. The committee will coordinate regulatory modernization, restore investor trust, and establish South Korea as a competitive hub for crypto.
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