South Korea Plans Bitcoin ETFs by 2025 to Boost Crypto Adoption

South Korea is poised to join the global trend of embracing Bitcoin exchange-traded funds (ETFs) by the end of 2025. The country's Financial Services Commission (FSC) has submitted a comprehensive roadmap to the Presidential Committee on Policy Planning, outlining the steps necessary to approve local spot Bitcoin ETFs. This move is in line with President Lee Jae Myung’s election promise to lift the domestic ban on crypto ETFs, aiming to integrate the country’s significant crypto holdings into its financial ecosystem.

The roadmap emphasizes the establishment of robust regulatory frameworks, including enhanced anti-money laundering (AML) and custody standards, to mitigate systemic risks. This initiative is part of South Korea's broader strategy to address gaps in its financial ecosystem and position itself as a regulated crypto hub, competing with other regional leaders such as Singapore.

South Korea boasts one of the world’s largest retail cryptocurrency markets, with its citizens holding approximately 104 trillion won in crypto assets by the end of 2024, according to FSC data. The successful launch of spot Bitcoin ETFs could significantly increase these numbers, placing South Korea among the leading countries in cryptocurrency adoption.

In addition to Bitcoin ETFs, the initiative includes plans to introduce won-based stablecoins by late 2025. This move addresses concerns raised in a 2024 IMF study about capital outflows, estimated at $40.8 billion in early 2025. President Lee views this as a means to bolster financial sovereignty and empower the youth economically, aligning with his administration’s agenda.