TLDR
- South Korea has introduced a roadmap to launch regulated spot crypto ETFs and stablecoins by late 2025.
- The Financial Services Commission has submitted the plan to the Presidential Committee on Policy Planning.
- The roadmap includes custody systems, pricing mechanisms, operational structures, and strict investor protection rules.
- President Lee Jae-myung supports the legalization of crypto ETFs and aims to reduce trading fees to 0.015%.
- The plan proposes Korean won-based stablecoins to support payments remittances, and domestic capital retention.
South Korea has taken a decisive step toward integrating crypto into its regulated financial system through a new government roadmap. The Financial Services Commission (FSC) submitted the plan to the Presidential Committee on Policy Planning this week. Officials aim to introduce spot crypto exchange-traded funds and stablecoins by late 2025.
Spot ETFs and Regulatory Framework
The FSC’s proposal outlines a structured plan for introducing regulated spot crypto ETFs in South Korea’s financial markets. It includes measures for custody, pricing, fund operation, and strict investor protection rules. Officials said the move aligns with President Lee Jae-myung’s campaign pledge to legalize crypto ETFs and strengthen safeguards.
President Lee’s administration views this as a shift from the former government’s ban on crypto ETFs. The ban was imposed over concerns about market risk and volatility. However, authorities now aim to match progress in the U.S. and Europe, where spot ETFs have already gained approval.
Under the roadmap, South Korea will create technical systems to support ETF trading on local exchanges. The FSC plans to reduce trading fees from the current 0.05% to 0.015%. This change targets affordability for retail and younger investors.
South Korea to regulate local stablecoins
The government also plans to regulate Korean won-based stablecoins under the same roadmap. These assets will be pegged to the local currency and could be used for payments and remittances. The Bank of Korea governor stated that issuance should remain with the central bank.
Officials believe local stablecoins will reduce reliance on offshore tokens such as Tether and USDC. Domestic companies could then issue compliant tokens within a regulated framework. This initiative aims to keep capital within South Korea and increase oversight.
In addition, the FSC will enforce stricter rules for exchanges operating in the country. Measures include lifetime bans and heavy fines for illegal activities. Platforms will also need to disclose trading fees and listing requirements more transparently.
Institutional Trading and Global Competitiveness
The roadmap introduces phased approvals for institutional crypto trading by banks and asset managers in South Korea. This could attract more capital into the market and strengthen links between traditional finance and digital assets. Spot ETFs are expected to serve as a bridge for this integration.
Industry analysts note that South Korea’s regulatory approach is becoming similar to that of other nations with approved ETFs. Risk assessments, custody frameworks, and monetary policy reviews will influence the final rules. Authorities intend to balance investor safety with global competitiveness.
While the proposals require legislative approval, the FSC’s direction signals a clear shift. South Korea aims to position itself as a competitive and regulated hub for digital asset investment.
