Major Crypto Regulatory Overhaul Announced
South Korea’s ruling People Power Party unveiled a sweeping set of reforms aimed at bringing the nation’s digital asset ecosystem into the modern age. Of seven major legislative reforms, a landmark step is the greenlighting of spot Bitcoin ETF trading, which is set to be in place by the end of 2025, said local news outlet Edaily.
For the first time, investors from South Korea will have the opportunity to invest in exchange-traded funds (ETFs) that are tied to major cryptocurrencies like Bitcoin and Ethereum. Representative Park Soo-min said such reforms were urgent, as major financial hubs like the U.S., Hong Kong, and the U.K. have already legalized similar financial instruments.
Hong Kong and the U.K. have approved spot ETF trading one after the other. Korea cannot lose any time,” Park said.
The approval is seen as a necessary step in assisting South Korea in remaining competitive in the rapidly evolving global crypto market.
Facilitating Institutional Participation
By the second quarter of 2025, 3,500 institutions and corporations, including 2,500 listed companies and 1,000 investment companies, will be able to trade digital assets freely. This is a dramatic shift from past restrictions that kept institutions out of the crypto space.
Another major reform is the elimination of the limiting “One Crypto Exchange, One Bank” policy. Exchanges were limited to working with a single bank, primarily to combat money laundering. Exchanges will now be allowed to partner with multiple banks, promoting healthier competition and innovation.
Other Reforms: Token Securities and Taxation
The People Power Party also vowed to create a token securities (STO) bill, introduce a stablecoin regulation system within global standards, and implement a dedicated crypto taxation system. These steps are designed to build a stronger, safer foundation for industry expansion.
There will be a special committee chaired by the presidential candidate that will oversee the regulatory implementation, with institutionalization of virtual assets and promoting industrial innovation.
Crypto Investments Surging Among South Koreans
A recent study by Hana Bank concluded that young South Korean investors now prefer crypto assets. In addition, more than 30% of the country’s wealthy now prefer cryptocurrencies as a long-term investment, surpassing traditional assets like real estate and gold.
