South Korea is set to explore the approval of cryptocurrency exchange-traded funds (ETFs) and allow firms to launch security token offerings (STOs) by 2025, a move announced by the Chairman of the South Korea Exchange, Jeong Eun-bo, during the Securities and Derivatives Market Opening Ceremony 2025. Jeong emphasized the need to delve into new business sectors, like crypto ETFs, in light of a political crisis that has destabilized the country’s markets, leading to a mass exodus of investors.
Amidst these economic challenges, Jeong stressed that new possibilities in the capital market, such as alternative assets, could revitalize interest from both domestic and international investors. He also highlighted the initiative to benchmark successful overseas practices for these new ventures. This comes as part of a broader strategy, including South Korea’s corporate value-up program, to enhance investor analysis and corporate performance.
Furthermore, Kim Byung-hwan, Chairman of the Financial Services Commission (FSC), expressed enthusiasm for institutionalizing STOs. Acknowledging a years-long wait by companies for permission to issue such tokens, Kim outlined plans to improve South Korea’s IPO system and refine listing procedures to ensure fair public offering prices. This development is part of a broader effort to diversify the securities market and stimulate corporate growth through innovative investment tools.
These initiatives reflect South Korea’s ambition to advance its regulatory framework in the crypto sector, aiming to legitimize and institutionalize these digital assets. However, progress is pending the resolution of political turmoil, with crypto regulations currently paused following President Yoon Suk-yeol’s impeachment proceedings. A warrant for the President’s arrest was issued but remains unenforced due to security concerns.
