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US ETF Ruling to Inform South Korean Cryptocurrency Market

Exchange Awaits US Ruling to Develop ETF Policy

A report published by The Korea Herald has asserted that officials at a South Korean exchange are waiting for United States lawmakers to establish a precedent regarding cryptocurrency ETFs. The report quotes an anonymous source claiming to work as an official at South Korea’s main bourse operator, Korea Exchange.

The source asserted that “The US has been the front-runner on the cryptocurrency market and related derivatives,” noting that despite “strong voices supporting the launch of bitcoin ETFs within the market,” they are “observing the progress and response of the U.S. Securities and Exchange Commission’s decision on bitcoin ETFs.”

US ETF Ruling to Inform South Korean Regulatory Policy

The source also stated that the launch of cryptocurrency ETFs would require “a solid index, adding that the prospective index is “being discussed expansively at [The Korea Exchange] because it would eventually concern investor protection issues.”

Permissive Korea Exchange’s Policies for Bitcoin ETF Likely to Be Accompanied by Strict KYC Guidelines

Lee Kyung-ho, a professor at Korea University’s Graduate School of Information Security, described the Korea Exchange’s framework as intended to “minimize the risk of integrating ETF transactions” in South Korea’s cryptocurrency sector.

The professor emphasized that a permissive framework pertaining to cryptocurrency ETFs would require strict know-your-customer (KYC) and anti-money laundering (AML) procedures, stating that “The government has been requesting cryptocurrency exchanges to adopt what is known as the rules of KYC and AML to boost transparency in transactions.”

US ETF Ruling to Inform South Korean Regulatory Policy

Lee also asserted that South Korea’s government has recently been expanding its investments into the “research and development of blockchain technology.”