South Korea Proposes Bitcoin Inclusion in Financial Investment Act to Boost ETF and Custody Services

South Korea is advancing its regulatory framework for digital assets as Democratic Party lawmaker Min Byeong-deok proposes an amendment to the Capital Market and Financial Investment Business Act. This legislative update seeks to formally recognize virtual assets as eligible underlying assets within financial investment products, including Exchange-Traded Funds (ETFs). By integrating digital currencies like Bitcoin into the legal structure, the amendment aims to empower trust companies with the authority to securely custody and manage these assets, aligning with President Lee Jae-myung’s strategic policy objectives. Upon enactment, this reform will enable investors to gain exposure to digital assets through regulated financial instruments, thereby bolstering market transparency and enhancing investor protection. This development marks a significant step towards institutionalizing cryptocurrency investments within South Korea’s capital markets, reflecting a broader trend of regulatory adaptation to emerging financial technologies.