According to TechFlow, the Korea Institute of Finance (KIF) said that spot cryptocurrency ETFs are harmful to the local economy. South Korean regulators currently prohibit local issuers from launching cryptocurrency ETFs.
KIF noted that the introduction of spot cryptocurrency exchange-traded funds could lead to more problems than benefits, including less efficient resource allocation, increased financial market risks, and weakened financial stability.
South Korea currently does not allow the issuance or trading of spot cryptocurrency ETFs, but the left-wing Democratic Party recently proposed an initiative to make spot cryptocurrency ETFs available locally.