Korea Exchange chairman Jeong Eun-bo announced plans to launch crypto ETFs and extend trading hours to 24\/7 operations during the bourse\u2019s first trading session of 2026.<\/p>\n
The pledge arrives as South Korea\u2019s financial regulator and central bank remain locked in a prolonged dispute over stablecoin issuance rules<\/a> that have pushed comprehensive digital asset legislation into next year.<\/p>\n According to the local report, Jeong told attendees at the Korea Exchange\u2019s Seoul headquarters that new investment products, including virtual asset ETFs<\/a> and derivatives, would be introduced as part of efforts to overcome the \u201cKorea Discount\u201d and upgrade the capital market.<\/p>\n He also committed to deploying AI-based monitoring systems and strengthening crackdowns on stock manipulation through a joint response team.<\/p>\n Korea Exchange Chairman Jeong Eun-bo. | Source: Yonhap<\/p>\n Korea Exchange Ready, Regulators Still Divided <\/p>\n The Korea Exchange\u2019s readiness to launch crypto products contrasts sharply with regulatory delays that have stretched back years.<\/p>\n The Financial Services Commission submitted a roadmap in June<\/a> proposing spot crypto ETFs for late 2025, but the plan has yet to materialize.<\/p>\n Meanwhile, South Korea\u2019s comprehensive Digital Asset Basic Act remains stalled in 2026 after the Financial Services Commission and Bank of Korea failed to reach an agreement on stablecoin governance<\/a>.<\/p>\n The central bank insists that stablecoins should be issued only by bank-led consortia, with lenders holding at least a 51% ownership stake.<\/p>\n The FSC has resisted the fixed threshold, warning it could sideline technology firms and slow innovation in digital payments.<\/p>\n Regulators also disagree on whether a new licensing committee is needed for stablecoin oversight.<\/p>\n Beyond stablecoins, the draft law would introduce strict investor protections, including full-reserve custody requirements, and raise compliance standards for crypto service providers to match those in traditional finance.<\/p>\n Initial coin offerings banned since 2017 could return under strict disclosure rules.<\/p>\n Stablecoin issuers would be required to hold reserves entirely in bank deposits or government bonds, with 100% of those reserves entrusted to licensed custodians.<\/p>\n The regulatory impasse continues despite strong political momentum from President Lee Jae-myung\u2019s administration, which campaigned on easing digital asset restrictions.<\/p>\n The ruling Democratic Party introduced legislation in June to amend the Capital Markets Act, expanding the definition of underlying assets for ETFs to include Bitcoin and other digital currencies.<\/p>\n Story Continues <\/p>\n A separate bill proposed legalizing stablecoin issuance by domestic firms with a minimum capital of 500 million won.<\/p>\n However, Bank of Korea Governor Rhee Chang-yong has opposed the development of non-bank stablecoins due to monetary policy concerns.<\/p>\n Enforcement Drive Continues Across Major Exchanges <\/p>\n While policy debates drag on, enforcement actions have accelerated.<\/p>\n The Financial Intelligence Unit imposed a \u20a927.3 billion fine on Korbit in late December following approximately 22,000 anti-money laundering violations identified during October inspections.<\/p>\n The regulator found failures in customer identification, unauthorized transactions with unregistered overseas platforms, and inadequate money-laundering risk assessments for new products.<\/p>\n The Korbit penalty followed earlier sanctions against Upbit operator Dunamu, which received a three-month suspension on new customer accounts in February and a \u20a935.2 billion fine in November.<\/p>\n Bithumb, Coinone, and GOPAX remain under review as the FIU works through cases in inspection order, with total fines across the sector expected to reach hundreds of billions of won.<\/p>\n Authorities are simultaneously expanding transaction monitoring requirements.<\/p>\n The same late last month, a task force led by the FIU is reviewing whether to extend the travel rule to cover crypto transfers below 1 million won, closing a gap regulators say has enabled smurfing techniques used to evade reporting thresholds.<\/p>\n The proposed changes would require exchanges to collect sender and recipient information for all virtual asset transfers, regardless of size.<\/p>\n Mixed Signals From Financial Authorities <\/p>\n The regulatory uncertainty has created contradictory guidance for asset managers.<\/p>\n In July, the Financial Supervisory Service issued verbal warnings restricting the proportion of crypto-related stocks, such as Coinbase and MicroStrategy, in domestic ETF portfolios, citing administrative guidance from 2017 that remains in effect.<\/p>\n Several Korean ETFs already hold double-digit allocations to these companies through passive index tracking.<\/p>\n However, industry participants argued that the restrictions create unfair advantages for US-listed crypto products while failing to prevent capital outflows.<\/p>\n \u201cRestricting only domestic ETFs will not stop the flow of funds, and in reality, many investors are already bypassing the market with U.S. ETFs,\u201d one source noted at the time.<\/p>\n Read original story South Korea’s Top Exchange Says It’s Ready for Bitcoin ETFs, But Regulators Still Stalling<\/a> by Anas Hassan<\/a> at Cryptonews.com<\/p>\n","protected":false},"excerpt":{"rendered":"Korea Exchange chairman Jeong Eun-bo announced plans to launch crypto ETFs and extend trading hours to 24\/7 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