South Korea Looking To Ease Institutional Crypto Ban
South Korea's Financial Services Commission (FSC) announced its plans to ease restrictions on institutional investors opening accounts on crypto exchanges, with non-profits first to gain access.
What's the Scoop?
- Current Ban: While not explicitly banned, institutions have been unable to participate due to FSC guidance discouraging banks from allowing institutional accounts.
- Presidential Agenda: This move aligns with President Yoon Suk-yeol’s campaign promise to foster South Korea’s crypto sector, including plans for local spot crypto ETFs.
- Regulatory Framework: Following the Virtual Asset Investor Protection Act, enacted in July 2024, the FSC aims to introduce new rules covering stablecoins, exchanges, token listings, and screening systems for major shareholders in crypto firms.
Bankless Take:
This next step in South Korea's gradual embrace of crypto is a notable pivot for a market historically cautious about digital assets. By introducing staged access and bolstering regulatory frameworks, the FSC is aiming to balance fostering innovation and maintaining oversight.
This development signals potential new inflows of capital and legitimacy into South Korea's crypto market, setting it up for a run as a regional leader in the industry — especially on the back of possible domestic spot crypto ETFs launches. It really feels that, around the world, the regime has shifted to pro-crypto.