South Korea is actively evaluating the approval of spot #Bitcoin exchange-traded funds (ETFs). In October 2024, the Financial Services Commission (FSC) established a Virtual Asset Committee to deliberate on this matter. This committee, led by FSC Vice Chairman Soyoung Kim, comprises representatives from various government departments and nine private sector members. Its mandate includes assessing the authorization of spot crypto ETFs and corporate accounts for digital assets.

The FSC's move to reconsider its previous ban on spot crypto ETFs reflects a shift in regulatory perspective. This change is influenced by the global trend of increasing institutional interest in such financial products, notably in the United States. The potential approval of spot Bitcoin ETFs in South Korea could enhance the country's position in the digital asset market, attract institutional investors, and mitigate phenomena like the "Kimchi premium," where cryptocurrency prices in South Korea trade at a higher price than the global average.

However, concerns persist regarding the risks associated with introducing these financial products. The Korea Institute of Finance has highlighted potential issues, including increased inefficiency in resource allocation and heightened exposure to crypto-related risks, which could undermine financial stability.

As of now, the FSC is in the process of reviewing its policies, and no definitive timeline has been provided for the approval of spot Bitcoin ETFs. The outcome of these deliberations will significantly influence South Korea's regulatory landscape and its integration into the global cryptocurrency market.