South Korea's ruling party pledges spot crypto ETF trading, expanded bank access as election looms: report

The People Power Party (PPP), a major right-wing political party in South Korea, has pledged to expand banking access for crypto exchanges and allow trading of spot crypto exchange-traded funds within this year, as it seeks to court the crypto sector ahead of the upcoming presidential election.

In a Monday meeting at the National Assembly, the party unveiled seven initiatives to foster a crypto asset ecosystem, local news outlet Edaily reported . The party first pledged to scrap the "one exchange, one bank" rule, which financial authorities had enforced to curb money laundering and monitor suspicious transactions by requiring crypto exchanges to partner with a single bank for real-name verified accounts.

The PPP also pledged to permit spot crypto ETF trading within this year. Park Soo-min, a lawmaker, said that U.S. spot bitcoin ETFs have attracted strong interest and large trading volumes, adding that South Korea "cannot afford to delay any longer," according to the report. Both the PPP and the Democratic Party have previously called for lifting the ban on spot crypto ETFs.

The PPP’s crypto proposals come as South Korea prepares to elect its new president on June 3. Yoon Suk-yeol, the country’s 20th president, was removed from office on April 4 after the Constitutional Court unanimously upheld his impeachment over a controversial martial law declaration in December.

As part of the crypto initiatives announced Monday, the PPP also plans to legalize security token offerings and introduce a regulatory framework for stablecoins in line with global standards. It also intends to propose a bill called the "Digital Asset Promotion Basic Act."

To carry out its initiatives, the PPP intends to set up a special crypto committee under its presidential candidate. The committee is expected to lead efforts to promote crypto, support industry innovation and rebuild investor confidence, according to the local media report.

South Korea’s financial authorities are moving to ease crypto restrictions. In January, the Financial Services Commission said it would gradually lift a ban that prevents institutional investors from investing in cryptocurrencies. The agency is also pursuing follow-up legislation to the country’s first crypto regulatory framework, focusing on stablecoin rules, token listings and disclosure requirements.