- If elected president, Lee Jae-myung plans to permit spot cryptocurrency ETFs and implement measures to enhance investor protection.
- With 16 million South Korean voters now operating digital assets, crypto policy is the name of the game.
- Ahead of the June election, South Korea’s two main political parties have unveiled rival cryptocurrency platforms.
South Korean presidential candidate Lee Jae-myung has pledged to approve spot cryptocurrency exchange-traded funds (ETFs) and implement regulatory reforms to strengthen investor protection if elected. The Democratic Party’s nominee made the announcement on May 6, as part of a broader push to appeal to younger voters ahead of the country’s June 3 presidential election.
In a social media post, Lee explained the intention of proposals for improving the digital assets investment environment. He also underscored plans to allow spot crypto ETFs and merged the regulatory body overseeing the sector. The effort is aimed at an expanding population of young South Koreans who have looked to invest in digital assets due to elevated housing costs and limited ability to access other investment opportunities.
Lee Plans Legal Framework for ETFs and Investor Oversight
Lee said his administration would push for the legalization of spot crypto ETFs, allowing retail and institutional investors to gain exposure to digital assets through regulated channels. This is because other global markets, including Hong Kong and the United States, have already moved forward with similar financial products.
He also suggested that the country create a unified digital asset regulatory system to take the place of the country’s current fragmented oversight system. Such a system would increase transparency, reduce market manipulation, and better protect investors, particularly those without knowledge of the risks of cryptocurrency trading, Lee said.
Lee’s plan also involves lowering high trading fees and examining the regulatory requirements incumbent on a cryptocurrency platform. His party has also called in Professor Kim Yong Jin, a tokenized securities specialist, to consult with policy development in the sector.
A lawmaker from the Democratic Party has recently introduced the Digital Asset Promotion Basic Act, aimed at laying the foundation for comprehensive digital asset regulation. The bill seeks to streamline crypto-related laws and support the development of blockchain technologies under a secure and monitored system.
Crypto Emerges as Key Election Issue Amid Growing User Base
Crypto policy has become central to the next election as around 6% of the country’s population of approximately 17 million are now crypto users, with the percentage accounting to 36% of the electorate. In response to a growing number of voters who are invested in the market, both of the major political parties have staked clear positions on digital asset regulation.
The other wide crypto policy agenda was also introduced by the ruling People Power Party. A seven-part plan published by the party in April lists approving spot Bitcoin ETFs, as well as allowing institutional investors to trade digital assets, and banning the country’s one exchange, one bank regulation. The current policy limits crypto exchanges to dealing with just one bank for real-name accounts, a rule critics say restricts the level of competition and growth.
Representative Park Soo-min of the People Power Party has voiced urgency over ETF approval, citing developments in other global financial centers. He noted that delaying action on crypto regulations would cause South Korea to fall behind other jurisdictions. But it also proposes setting up a dedicated cryptocurrency policy committee under its presidential candidate, Kim Moon-soo. The need for greater safeguards is being emphasized by Kim for the millions of Korean retail investors who invest in crypto markets.
As candidates continue outlining their platforms, digital asset policy remains a focal point of the race. Voters under 40, who face increasing barriers to wealth-building through traditional investments, are expected to weigh crypto reform heavily when casting their ballots.
