South Korean Financial Regulator Says U.S. Bitcoin ETFs May Violate Local Law

South Korea’s Financial Services Commission (FSC), the nation’s financial regulator, said in a statement that recently-listed U.S. bitcoin ETFs may violate Korean law.

The regulator says that domestic brokerage of a U.S.-listed bitcoin spot ETF by Korean securities firms may potentially conflict with the country’s Virtual Asset User Protection Act and the Capital Markets Act without elaborating.

In 2017, The Bank of Korea’s governor, Lee Ju-yeol, stated that cryptocurrencies are commodities, not legal tender, and emphasized the need for regulation in this area.

The FSC said in its notice that further review is coming. SEC chair Gary Gensler is scheduled to meet his Korean counterpart sometime this month in Washington, DC.

Recently, authorities in South Korea said they were planning on creating regulations that would make officials’ crypto holdings public.

In the U.S., Vanguard has decided not to offer spot bitcoin ETFs, including BlackRock’s iShares Bitcoin Trust (IBIT) and Grayscale Bitcoin Trust (GBTC), on its platform, citing what it calls a misalignment with the company’s investment portfolio strategy.