According to reports, South Korea intends to progressively remove its prohibition on business investment in virtual assets starting this year.
On January 8, Yonhap News reported the news, citing the Financial Services Commission (FSC), the nation’s financial watchdog.
South Korea to See Institutional Crypto Investment
According to reports, the FSC has laid out a plan to allow institutional investors to access the virtual asset market. The nation’s retail and institutional cryptocurrency investors should find a more stable and regulated environment due to the action.
Regulations in South Korea now limit companies from being granted real-name accounts. Even though there was no legal prohibition against granting such accounts, the restriction was in place.
Investing in virtual assets requires real-name accounts. Regulators, however, advised banks against opening these accounts to businesses, which reduced institutional involvement in the market.
As a result, authorities have only so far allowed retail investors to participate in cryptocurrency marketplaces.
Yonhap claims that on January 8, the FSC declared it would examine a proposal to progressively permit firms to create real-name accounts on exchanges. Non-profit corporations will be the first to do this, followed by others.
South Korea’s most recent action comes after the “Virtual Asset User Protection Act” was enacted in 2024. The Act sought to increase market stability and safeguard individual cryptocurrency investors.
The FSC is now advocating for a second stage of laws about virtual assets. This entails dealing with listing requirements and stablecoins and conducting guidelines for virtual asset exchanges.
“We need to discuss how to create listing standards, what to do with stable coins, and how to create rules of conduct for virtual asset exchanges. We will work to align with global regulations in the virtual asset market,” FSC director Kwon Dae-young said.
This most recent development comes after it was disclosed that over 30% of South Koreans are cryptocurrency investors. According to the data, there were 15.59 million domestic investors in digital assets in late November, up 610,000 from late October.
The nation deferred a 20% tax on profits from virtual assets over 2.5 million won in December, another encouraging step. With advantageous legislation, South Korea is establishing itself as the leader in the global cryptocurrency business.
