South Korea’s crypto market poised for change with new institutional guidelines
South Korea plans to relax restrictions on crypto trading for institutional investors, indicating a shift in digital asset regulation. The Financial Services Commission (FSC) will implement phased regulatory changes to allow institutional participation, currently limited to verified retail investors. Banks face restrictions on opening crypto accounts for institutions, hindering their market involvement. The FSC will work with the Digital Asset Committee, starting with non-profit organizations gaining access. Additionally, the FSC is set to roll out the second phase of the Virtual Asset User Protection Act, establishing guidelines for crypto listings, stablecoins, and exchange conduct. Revisions to the Special Financial Transactions Act will introduce a review system for crypto exchange shareholders, incorporating social credit evaluations. The FSC aims to align South Korea's regulations with global standards and is also advocating for the launch of spot-based crypto exchange-traded funds (ETFs) to enhance the country's capital markets.
