FSC’s ‘Cautious Stance on Bitcoin ETF’…Min Byung-deok: “There’s No Time to Stand Idle”

The Financial Services Commission (FSC) has shown a cautious stance regarding the introduction of Bitcoin spot ETFs. While recognizing the market expansion effect for virtual assets, the Commission explained that it must comprehensively consider various issues such as capital market stability and investor protection. In response, Min Byung-deok of the Democratic Party of Korea pointed out, "There’s no time to stand idle," stressing that the speed of institutionalization must accelerate.

Nam Chang-woo, an official at the Financial Services Commission, stated at the 'National Assembly Forum for the Enactment of the Digital Asset Innovation Act' held at the National Assembly on the 30th, "Bitcoin spot ETFs can improve accessibility for virtual asset investors, and since they will be regulated under the Capital Markets Act, individual investor confidence may also be enhanced," adding, "As financial institutions enter the virtual asset market, we also expect the foundation of the market to broaden."

However, he continued, "From the authorities’ viewpoint, we cannot ignore the possibility of domestic stock market funds flowing into the virtual asset market, or the issues of financial market stability and soundness, as well as investor protection, that could arise as the traditional financial market connects for the first time with the virtual asset market," and pledged, "We will participate in discussions to devise a balanced and effective introduction method."

Nam stated, "The introduction of Bitcoin ETFs involves many specific matters for discussion beyond revising laws, such as establishment, management, custody, and evaluation," and explained, "We need to discuss how to secure virtual assets, whether by cash creation or in-kind creation, from whom and how to store them safely, and how to calculate the index."

As the FSC takes a careful approach to the introduction of Bitcoin spot ETFs, Min remarked, "The FSC said it would participate in discussions, but in reality, no actual consultations have taken place," pointing out, "Just as the automobile industry was once regulated by horse-based standards, a new approach is becoming impossible because digital assets are still viewed only under the criteria of existing financial products."

Min further stressed, "Digital assets are surging like a tsunami, but institutionalization is being delayed as people keep worrying about ‘monetary policy’ only from the perspective of traditional economists. We must break free from previous frameworks and move into the arena of public discussion."

He added, "If there are concerns, we need to quickly find solutions instead of stopping. Direction is important, but speed matters more. There’s no time to stand idle. Concentrated discussions are urgently needed for both consumer protection and market stabilization."