South Korean Authorities to Assess Proposal Allowing Companies to Acquire Cryptocurrency ‘This Year’

South Korean authorities have announced their intention to “assess a plan” to “gradually allow companies” to acquire, promote, and manage cryptoassets such as Bitcoin (BTC).

According to Busan Ilbo and Asia Kyungjae, the Financial Services Commission (FSC) indicated that it would provide further details following “conversations” with the Digital Asset Committee.

The Digital Asset Committee serves as a regulatory and policy-making entity for cryptocurrency, reporting to the FSC, and was established in late 2024. Its next meeting is scheduled for January 15.

South Korean Regulators: A Shift in Attitude Towards Bitcoin ETFs?

The FSC is the sole authority in the nation empowered to permit companies to purchase cryptocurrencies using their balance sheets.

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In principle, there are no legal barriers preventing companies from acquiring BTC and other cryptocurrencies. However, the regulator has instructed banks to deny corporate requests for establishing crypto exchange-linked accounts.

Last year, several South Korean media outlets reported that the FSC had developed a “roadmap” that would initially allow universities and public entities to accept crypto donations.

This roadmap, as reported, would eventually lead to the FSC approving BTC purchases for “ordinary” and financial sector companies such as banks.

The headquarters of the South Korean Financial Services Commission. (Source: MBCNEWS/YouTube/Screenshot)

The FSC later responded by refuting these claims, asserting that “nothing” had yet “been decided.” However, it now appears that the media reports were not as “baseless” as the FSC suggested.

The regulator also expressed its intention to “protect” crypto “users” and will support efforts to “enhance” self-regulation within the industry.

The FSC aims to “establish listing and delisting criteria” for altcoins on domestic crypto exchanges.

This statement came as crypto traders voiced increasing concerns about significant reductions in meme coins and “kimchi coins” on local crypto exchange platforms.

The FSC also mentioned its desire to implement new regulations to oversee the stablecoin sector.

“There’s a need to discuss how to create listing standards, what to do with stablecoins, and how to establish codes of conduct for cryptoasset exchanges. We will work to align them with international regulations.”

FSC spokesperson

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Financial Services Commission Director Kwon Dae-young

The regulator also aims to develop protocols to assist in “investigating unfair practices in the crypto sector” “through the introduction of advanced forensic technology.”

The FSC appears to believe it must keep pace with the “institutionalization of digital assets in global financial markets, led by the US and Europe,” as noted by Asia Kyungjae.

However, media outlets have reported that the FSC has generally been “unfavorable” regarding the approval of Bitcoin spot ETFs.

The Korea Exchange Chairman Jeong Eun-bo recently expressed a willingness to explore the approval of crypto ETFs.

In his New Year address, the Korea Financial Investment Association Chairman Seo Yu-seok discussed transforming the “digital asset market, including crypto ETFs,” into a “future growth engine.”

“I will advocate for the legalization of token securities and cryptoasset ETFs to ensure that the digital asset market can become a driving force for the future growth of our capital market.”

Korea Financial Investment Association Chairman Seo Yu-seok

However, FSC Director Kwon Dae-young stated that approving crypto ETFs would be “a step too far.” He acknowledged that the government was “fully aware that changes are occurring globally.”

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Further Discussions Planned

Seoul is currently “discussing the matter” with the Digital Asset Committee, Kwon stated. However, critics have insisted that South Korean regulators and the government need to streamline their crypto policies and address several unresolved issues.

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Hwang Seok-jin, a professor at Dongguk University’s Graduate School of International Information Security, informed Asia Kyungjae:

“The issue of [crypto tax] […] has been postponed for two years. However, we need to consider it in the future. In the case of companies [wishing to hold crypto], there will still be accounting challenges to address, such as how to account for increases and decreases in the value of the cryptoassets held by firms. We need to have an open dialogue on all these matters, one without any restrictions.”

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