President Lee Pushes Crypto Reform: Bitcoin ETFs on the Horizon in South Korea

South Korea’s newly elected president, Lee Jae-myung, is moving swiftly to legalize spot Bitcoin exchange-traded funds (ETFs), aiming to unlock greater investment opportunities for over 16 million crypto traders across the country. With nearly one-third of South Korean adults actively involved in digital asset trading, the demand for regulated investment vehicles has reached a tipping point. Currently, Korean investors are restricted from accessing domestic spot Bitcoin ETFs, forcing many to turn to foreign markets and high-risk leveraged products to gain exposure. In response, President Lee is prioritizing crypto-friendly reforms, pushing the Financial Services Commission (FSC) to align with global trends, especially after the United States approved spot Bitcoin and Ethereum ETFs earlier this year. His administration is also advancing a broader digital asset policy agenda, including the rollout of the “Digital Asset Basic Act,” aimed at improving investor protection, clarifying taxation, and enabling institutional participation. Advocates argue that approving spot Bitcoin ETFs could enhance transparency, attract institutional capital, and reduce risks for everyday investors. Additionally, proposals are underway to allow South Korea’s National Pension Service — one of the world’s largest sovereign funds — to allocate a portion of its portfolio to crypto assets. However, challenges remain: regulatory resistance, legal hurdles tied to the president’s past investigations, and uncertainty around the country’s central bank digital currency (CBDC) pilot could delay progress. Despite these headwinds, South Korea is positioning itself as a potential crypto innovation hub in Asia. If successful, the legalization of spot Bitcoin ETFs would not only satisfy domestic investor appetite but also signal the country’s readiness to blend financial modernization with regulatory oversight in one of the most tech-savvy economies in the world.