Korea Exchange Prepares for Crypto ETFs as Approvals Remain Pending
South Korea’s Korea Exchange (KRX) is actively preparing to support crypto exchange-traded funds (ETFs) and derivatives, signaling readiness even as regulators continue to deliberate on their approval under existing securities laws. The move is part of broader efforts to modernize the capital markets and reduce the so-called “Korea discount,” where domestic assets trade below global valuations. Interestingly, in crypto markets, Bitcoin often trades at a premium on local exchanges compared to overseas platforms.
KRX’s chairman highlighted initiatives such as a gradual shift to 24-hour trading and digital finance upgrades, reflecting the exchange’s commitment to infrastructure readiness. However, current regulations do not classify crypto assets as eligible securities, effectively preventing crypto ETFs despite rising investor demand. The Financial Services Commission is actively reviewing reforms through a dedicated crypto committee, including potential recognition of digital assets under the Capital Markets Act.
Support for crypto ETFs is growing among both industry and political leaders. In February, the head of the Korea Financial Investment Association emphasized the push for Bitcoin and Ether ETFs. Ahead of the June presidential election, candidate Lee Jae-myung pledged to approve spot crypto ETFs if elected, and following his victory, market participants are optimistic about future regulatory approvals.
With market infrastructure in place and rising political and financial support, South Korea is poised to expand its crypto ETF offerings, though regulatory approval remains the final hurdle.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.