• The FSC is attempting to address the regulatory frameworks and issues of virtual assets.
• Prominent securities firms have suspended brokerage services for the global Spot BTC ETFs.

South Korean securities companies may have violated regulations by brokering Spot Bitcoin ETFs registered abroad, according to a press statement by the Financial Services Commission (FSC) on January 12.

The advice is issued at a time when the FSC is attempting to address the regulatory frameworks and issues presented by virtual assets. As a result, prominent securities firms such as Samsung Securities and Mirae Asset Securities have taken preventative measures by suspending their brokerage services for the Canadian and German Spot Bitcoin ETFs.

Wait and See Approach

Moreover, this preventative action is in response to a warning from the nation’s financial regulator, which warned against trading Spot Bitcoin ETFs listed outside in the country.

In February 2021, the world’s first Spot Bitcoin ETF traded on the Canadian stock market, the ‘Purpose Bitcoin ETF’ (BTCC), was delisted by the prominent industry player Mirae Asset Securities. Amid regulatory concerns voiced by the Financial Services Commission, BTCC’s abrupt suspension is in line with its historically smooth trading history via local brokerage companies.

Securities companies that are not on the FSC’s warning list are nevertheless trading Bitcoin futures ETFs, according to the report, even though Spot ETFs are subject to regulations. Particularly noteworthy is the fact that the sector is now taking a wait-and-see approach in light of the future rules and restrictions imposed by financial authorities.

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