[NEWS] South Korea's ruling party pledges to approve Bitcoin spot ETF and extend cryptocurrency tax implementation in general election

The ruling party of South Korea, People's Power, has announced that it will consider a proposal for legislation related to crypto assets (virtual currencies) in its manifesto for the general election scheduled for April this year. Local media News1 reported on the 19th.

According to the report, People's Power will consider reviewing and establishing regulations on fundraising through Bitcoin spot ETFs and IEOs, as well as on crypto investments by corporations.

In relation to this, the party also included in its pledges the establishment of a "Digital Asset Promotion Special Committee" with the authority to propose and impose sanctions on crypto assets. Through this committee, it will work to promote the crypto asset industry.

In South Korea, the development of regulations on crypto assets is progressing at an accelerated pace, and the "Crypto Asset User Protection Act" is scheduled to come into effect in July this year. This bill aims to strengthen penalties for serious crypto asset-related crimes, such as market manipulation and illegal trading by businesses, and to improve the market environment in South Korea. The law could result in a maximum sentence of life imprisonment.

Focus on developing regulations for Bitcoin spot ETFs and IEOs

Currently, financial institutions are prohibited from offering cryptocurrency ETFs in South Korea, but the wind is changing as the first Bitcoin spot ETF has been approved in the United States.

Last month, the Financial Services Commission (FSC) recommended that domestic financial institutions be prohibited from handling Bitcoin spot ETFs offered in the United States. As a result, Samsung Securities and others have stopped intermediating cryptocurrency ETFs offered by overseas companies, including those in the United States.

Meanwhile, the South Korean presidential office has requested the FSC to review the current regulations regarding the handling of Bitcoin spot ETFs.

In addition, discussions will be held to gradually relax the requirements for IEOs, provided that safety measures are taken for users, and regulations will also be developed for security tokens (ST). Regarding security tokens, the government aims to enact legislation within the year and is accelerating discussions to quickly implement STOs, a fundraising method that utilizes the tokens.

In addition, the People's Power is said to be considering postponing the implementation of cryptocurrency taxation, which is scheduled to come into effect in January 2025. The implementation of cryptocurrency tax has been postponed in South Korea so far, and the ruling party is planning a two-year extension, including the time it will take to establish regulations, citing the current lack of clarity.

Reference:Press
Image: Shutterstock

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