By George Ward
With the approval of spot Bitcoin ETF by the US SEC, South Korea’s regulator has warned local platforms against dealing with the crypto-based products from the United States. However, weeks later, the country’s securities watchdog is on the verge of discussing with its US counterpart for insights on Bitcoin ETF.
Collaborating With The US SEC
The Financial Supervisory Service (FSS) of South Korea, the country’s primary financial regulatory authority, is considering collaborating with the United States SEC to gain valuable insights into spot Bitcoin ETF dynamics. The FSS, which oversees and regulates financial institutions within the Financial Services Commission’s extensive jurisdiction, aims to ensure the integrity and stability of South Korea’s financial system.
Lee Bok-Hyun, FSS’s chief executive, recently unveiled the agency’s business plan for 2024 during a presentation on February 5 at the Financial Supervisory Service in Seoul. A noteworthy aspect of the move entails strategic collaboration with advanced financial markets.
It also involves organizing high-profile visits to economic hubs such as New York. Through these engagements, the FSS will spearhead detailed discussions with other regulators regarding various aspects of the financial markets in South Korea.
As an area of focus, the South Korean regulator intends to deliberate and analyze the market dynamics and regulatory policies behind Bitcoin ETF. The FSS seeks constructive discourse to augment its understanding of the complexities of Bitcoin ETF as an investment vehicle.
Meeting Gary Gensler
Furthermore, Lee Bok-Hyun also disclosed his plans to consult with SEC chair Gary Gensler before the end of 2024. The primary objective of this consultation is to engage in discussions about various regulatory matters, including exchange-traded funds for spot Bitcoin and digital assets.
This meeting is consistent with the Financial Supervisory Service’s pledge to stay ahead of emerging trends and foster collaboration with international regulatory authorities. This correspondence with the SEC holds significant importance, especially considering the SEC’s precedent-setting authorization of spot Bitcoin exchange-traded funds within the United States.
Following The SEC’s Footsteps
After the SEC endorsed eleven spot Bitcoin ETFs early last month, the Korean securities regulator issued precautionary advice to domestic firms, warning them not to partake in the brokerage of such funds from the United States. According to the South Korean regulator, this advice is to mitigate risks and ensure compliance with existing regulatory frameworks.
More importantly, the regulator declared its intention to undertake an extensive examination and revision of the policies regulating the authorization procedure for spot Bitcoin ETF transactions in the United States. South Korea, a prominent regulatory authority in the crypto markets of the Asia-Pacific region, has consistently exhibited a proactive approach to ensuring that its regulatory practices align with what’s obtainable globally.
Interestingly, the country has frequently followed the regulatory path established by the United States about guidelines concerning cryptocurrencies.