South Korea is making strides towards modernizing its digital asset market, with the Financial Services Commission (FSC) leading the charge. The FSC has presented a new crypto roadmap to the Presidential Committee on Policy Planning, outlining plans to introduce spot cryptocurrency exchange-traded funds (ETFs) and regulate stablecoins by the second half of 2025.
The regulatory framework for spot crypto ETFs will encompass rules on fund structuring, custody, pricing, and investor protection. This move is aimed at bringing South Korea’s digital market in line with global standards, addressing concerns that the country could fall behind other major markets without action.
President Lee Jae-myung, who took office earlier this year, has committed to legalizing spot crypto ETFs as part of his campaign promises. He also plans to establish a unified oversight system to enhance investor protection and market transparency.
In addition to the ETF reforms, the FSC is working on legislation to oversee the issuance of Korean Won-based stablecoins. The commission will also enhance regulations around the listing and disclosure of virtual assets, as well as the operations of local crypto businesses and service providers.
Enforcement measures are also set to be strengthened, with the FSC proposing stricter penalties for misconduct, including permanent bans and hefty fines for individuals or firms engaged in illegal activities. Local exchanges will be required to reduce trading fees and enhance transparency by publicly disclosing and comparing fees, in line with President Lee’s goal of lowering transaction fees to support young traders.
While the roadmap represents significant progress towards the country’s digital ambitions, the FSC has clarified that none of the proposals are finalized yet, indicating that the plan is still in its early stages. The focus remains on building the necessary legal and technical infrastructure to support spot crypto ETFs and regulate stablecoins, ultimately fostering a more robust and transparent digital asset market in South Korea.