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The newly established South Korea’s Virtual Assets Committee, under the Financial Services Commission (FSC), is scheduled for its first meeting on November 6. The committee will deliberate on important regulatory topics such as Bitcoin Spot ETF, which will be a great step as South Korea is legalising its stance regarding investment in digital assets. The meeting is expected to accelerate discussions around crypto ETF approvals, where the FSC has previously delayed action.
In a move that could shape the future of South Korea's digital asset policies, the FSC has restricted industry professionals from joining the new committee due to potential conflicts of interest. Instead, it has appointed nine civilian members from top think tanks and academic institutions, including the Capital Market Research Institute and the Financial Research Institute.
FSC Chairman Kim Byung-hwan emphasised that the committee would rely on experts who have conducted research in virtual assets, aiming to bring a neutral perspective to policy-making.
The absence of industry leaders, including executives from the nation’s largest crypto exchanges under the Digital Asset Exchange Association (DAXA), has sparked concerns among some crypto advocates who argue that industry voices are vital for crafting effective regulations. Nonetheless, the FSC maintains that this approach fosters impartiality and aligns with its commitment to forming a committee of research-focused experts.
Beyond ETFs, the committee plans to introduce a new regulatory framework for stablecoins, reflecting South Korea's effort to build a more comprehensive and controlled environment for digital assets. The stablecoin discussion comes as regulatory bodies worldwide explore frameworks to manage stablecoin issuance and trading, aiming to mitigate associated risks.
Chairman Kim further noted that corporate crypto ownership would be a topic of interest, addressing rising calls from South Korean business leaders for regulatory clarity. South Korean companies are advocating for the ability to include cryptocurrencies in their financial strategies, highlighting that businesses in the United States and Japan are already incorporating crypto assets into their balance sheets.
As South Korean firms express worries about falling behind in the global crypto economy, the outcome of these discussions could significantly impact the country's position in the digital finance arena.
Although initially set to convene in September, the Virtual Assets Committee postponed its first meeting due to delays in finalising committee members. The renewed focus on crypto ETF discussions reflects a potential shift, with the FSC prioritising policies that align with international regulatory developments. By assembling this committee, the FSC signals its intent to align South Korea’s regulatory landscape with global practices while considering the unique demands of its domestic market.
