South Korea Signals Bitcoin ETF Approval as Crypto Push Accelerates

As part of a larger digital asset drive spearheaded by the Financial Services Commission (FSC) under its 2026 economic growth strategy, South Korea plans to open its markets to spot bitcoin ETFs this year, providing investors with regulated access to cryptocurrency markets.

Regulatory Shift Clears Path for Spot Bitcoin ETFs

The development of ETFs in the nation was previously prevented by the lack of legislative recognition for cryptocurrencies like Bitcoin as legitimate underlying assets.

The FSC seems to be taking a cue from other countries where spot bitcoin ETFs have been quite successful, such as the United States and Hong Kong. According to a BlackRock (BLK) official, these funds represent the largest source of income for the world's largest asset management firm.

According to the Korea Financial Intelligence Unit (KoFIU), 10.7 million people in the nation were able to trade during the first half of last year, with an average trading volume of 6.4 trillion Korean won ($4.39 billion).

The government is also working on a new Digital Asset Act that will regulate stablecoins. It is anticipated that the law will protect user redemption rights, mandate 100% reserve backing, and establish a licensing system for stablecoin issuers.

Additionally, it will describe how stablecoins can be transferred or traded internationally.

Separately, South Korea aims to utilise deposit tokens—digital tokens issued by the government that differ from stablecoins—to digitise public funds. By 2030, 25% of Treasury activities are to switch to blockchain-based payments.

Changes to the rules governing the central bank and treasury are anticipated this year, and pilot programs are already underway.