South Korea’s Ruling People Power Party (PPP) Announces Its Intensions to Reform the Existing Legal Framework Regarding the Use of Cryptocurrencies in the Country

People's Party in South Korea Announces Plans to Legalize Spot Crypto ETFs, Stablecoins, and More

The ruling People's Party in South Korea has announced its intentions to reform the existing legal framework regarding the use of cryptocurrencies in the country. The proposal follows President Yoon Suk Yeol's removal, which has intensified attention in the June 3 election. With political tensions growing higher, the party makes digital asset reform the cornerstone of its political agenda.

The party highlighted seven initiatives that it plans to implement if it comes into power following the upcoming election. A core commitment is the resolution of the approval of spot cryptocurrency ETFs by the end of this year. This brings the South Korean market on par with markets such as the US and Hong Kong that have already approved similar products. The party cites global trends to underline the need for the formation of a regulated approach to digital assets.

People's Party also plans to increase access to over 3,500 institutions and corporations to the crypto markets. The decision would allow listed companies and professional investment entities access to the markets. The proposed rollout is for this year, targeting to expand the broader access of digital assets under a legal framework.

Moreover, the industry will be opened for nonprofit corporations from the second quarter of the year, expanding further participation in the digital economy in South Korea. The reforms are intended for potential market unlocking with clear legislation and immediate change of regulation.

The party will also do away with the “one exchange, one bank” policy. This policy has remained a longstanding one which has associated each crypto exchange with one banking partner. Critics claim that it hinders competitiveness and results to monopolistic environment in the exchange segment.

This change will leave the exchanges free to engage the services of multiple banks. These enhance consumer choice and fairness within the trading ecosystem. The update comes at a time when there is a growing trend among globalization to more open financial markets with fewer barriers to entry. The ruling party highlighted that the older restrictions hamper technological advancement. However, they stated that these reforms will be more suitable for future international standards in crypto governance.

The party promises to enact the Framework Act on the Promotion of Digital Assets. This proposed law will address token securities, the regulation of stablecoin, and the procedure of listing and public disclosures. The act intends to improve confidence within the industry and protect the participants by establishing guidelines.

Stablecoins will be assigned their own regulation system. The party will define the issuing standards, reserve requirements, and operational policies. This will promote transparency and enhance global acceptance of digital currencies in payment and transfer services.

Another new measure is the creation of the Virtual Asset Special Committee, a body that will be based in the presidential office to ensure the fast tracking of reform implementation. It will also be charged with the responsibility of developing the digital asset tax regime and assisting in the management of new institutional policies.