South Korea’s PPP Demands Crypto ETF Greenlight—Takes Aim at Outdated Banking Restrictions
South Korea’s ruling People Power Party (PPP) is making aggressive moves to legitimize crypto ETFs—while simultaneously vowing to dismantle a decades-old banking rule that’s been throttling institutional adoption. The political push comes as local traders chafe under regulatory constraints while watching Hong Kong and the U.S. steal the ETF spotlight.
Key details: The PPP’s proposal would force Korea’s Financial Services Commission (FSC) to fast-track Bitcoin and Ethereum ETF approvals, bypassing the usual bureaucratic foot-dragging. More controversially, they’re targeting Article 37 of the Banking Act—a relic requiring separation between financial and industrial capital that’s effectively blocked megabanks from touching crypto.
Market impact: If successful, the move could funnel billions in institutional money into Korea’s crypto markets overnight. But skeptics note the same banks lobbying for these changes are the ones that called Bitcoin ’a Ponzi scheme’ back in 2018—convenient how blockchain becomes interesting once there’s a custody fee to collect.
- PPP vows to approve spot crypto ETFs, scrap restrictive banking rule
- Corporate crypto trading and stablecoin regulation set for overhaul
- Election outcome could determine fate of PPP’s crypto reforms
The People Power Party (PPP) of South Korea has proposed major crypto sector reforms that seek to approve spot crypto exchange-traded funds (ETFs) and eliminate banking rule restrictions. The party intends to allow corporate crypto trading and stablecoin regulation to strengthen South Korea’s position in the global digital asset market. The outcome of the June 3 presidential election will shape the future of the proposed reforms.
The PPP’s reform seeks to provide banking access for crypto exchanges and approve spot crypto ETFs. The party intends to eliminate the “one exchange, one bank” rule, which restricts crypto exchanges to one bank.
Many have criticized the rule , which seeks to curb money laundering, because it limits competition and consumer options. The PPP believes that the termination of this restriction will provide crypto exchanges with multiple banking partners to create a competitive market.
South Korea Eyes Crypto ETF Reforms
The PPP also seeks to approve the trading of spot crypto ETFs in 2025. Spot Bitcoin ETFs have seen substantial interest and huge trading volumes. The PPP believes the crypto ETF approval aligns South Korea with global trends such as the U.S. Securities and Exchange Commission’s (SEC) approval of Bitcoin ETFs in January 2024.
The PPP seeks to establish a complete stablecoin regulatory framework. The party plans to establish a global standard for stablecoin regulation to enable international compliance. This approach ensures clear regulations and promotes stability and innovation in the stablecoin market.
The PPP plans to introduce corporate participation in the crypto market. The proposal allows non-profits and about 3,500 corporations to trade crypto from Q2 2025. The move aims to boost crypto adoption and attract more institutional investors who previously faced challenges due to the banking rule.
South Korea’s Virtual Asset Special Committee
Furthermore, the PPP has announced plans to create a Virtual Asset Special Committee, which will operate under the presidential office. This committee would ensure the implementation of the party’s crypto reforms.
Moreover, the PPP seeks to pass the Framework Act on the Promotion of Digital Assets, which regulates crypto exchange operations as well as creates a standard for listing and disclosure of digital asset transactions.
However, the implementation and success of the PPP’s reforms depend on the outcome of the June election. The party faces competition from opposition leader Lee Jae-myung, who holds substantial voting power in the polls.
