South Korea’s Change Chairman, Eun-Bo Jeong, has signaled curiosity in introducing crypto-based exchange-traded funds (ETFs) this yr, aligning with world calls for for such merchandise.
On the Securities and Derivatives Market Opening Ceremony on Jan. 2, Jeong reportedly emphasised the necessity for revolutionary monetary merchandise to revitalize the nation’s capital markets.
Jeong highlighted the financial hurdles confronted prior to now yr, citing challenges corresponding to a contracting home financial system, decreased export progress, and geopolitical tensions.
He defined that these components have left South Korea’s monetary markets lagging behind their world counterparts. Impressed by the profitable worldwide launch of Bitcoin-related monetary merchandise, the change plans to discover new avenues, together with crypto-related ETFs, to handle these points.
This announcement marks a possible shift from South Korea’s earlier stance. Final yr, the Monetary Supervisory Service (FSS) restricted asset managers from providing ETFs tied to crypto-related corporations like Coinbase.
Nonetheless, the potential for crypto ETFs stays unsure resulting from regulatory hurdles. Ki Younger Ju, CEO of CryptoQuant, has raised issues in regards to the nation’s readiness to approve such merchandise.
Ju likened South Korea’s cautious regulatory stance to the Gary Gensler-led US Securities and Change Fee (SEC), the place resistance to crypto ETFs had delayed their adoption for over a decade till 2024.
Bitcoin ETFs success
In the meantime, world crypto ETFs’ rising success would possibly affect South Korea’s curiosity in these merchandise.
Bitcoin ETFs made a robust debut in the US by attracting substantial investments inside their first yr of buying and selling. Per SoSoValue information, the 12 ETF merchandise have amassed greater than $35 billion in inflows and demonstrated rising acceptance amongst institutional buyers.
Furthermore, market specialists anticipate additional innovation within the ETF panorama this yr, given the extra favorable regulatory regime led by the Donald Trump administration.
Contemplating this, Nate Geraci, president of the ETF Retailer, has predicted that the market may witness the launch of mixed Bitcoin and Ethereum ETFs, staking choices for the ETH funds, and broader diversification with belongings like Solana coming into the ETF area.
