South Korean regulators and government ministries are divided over whether the country should create a strategic Bitcoin reserves, a senior lawmaker has claimed.
Per the South Korean media outlet News Who Plus, the Democratic Party MP Ahn Do-geol claimed that “every government agency has a different position on virtual asset reserves.”
South Korean Strategic Bitcoin Reserves: Still a Long Way Off?
Ahn also urged Seoul to create a crypto governance platform with “minimal regulations” to encourage growth.
“The virtual asset market should no longer be viewed as a gambling den, but as a core component of the future financial industry. We must [quickly create] a system replete with minimum regulations to ensure investor protection.”
Democratic Party Lawmaker Ahn Do-geol
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Ahn suggested that regulators should work on matters such as launching guidelines for security token issuers, and “introducing crypto spot ETFs.”
The lawmaker also called on Seoul to “introduce [fiat] won stablecoins,” and “boost corporate and foreign involvement in the domestic market.”
Ahn also said that the government needs to launch a “tax system” for domestic crypto traders.
Doing all of this, the former Vice Minister, would ensure “that the Korean virtual asset market takes off on time.”
Ahn has previously served in the government as the Vice Minister of Strategy and Finance.
The lawmaker noted that his former ministry, the Bank of Korea (BOK), the Financial Services Commission (FSC), the National Pension Service, and the Korea Investment Corporation all appear to have taken differing positions on the question of whether Seoul should start buying Bitcoin (BTC).
Government Bodies, Regulators – Divided on BTC Reserves?
The Ministry of Strategy and Finance, the same media outlet wrote, has taken a wait-and-see attitude on national strategic Bitcoin reserves.
The ministry has claimed that the crypto sector is in “a transitional period.” As such, the ministry said it “plans to examine major trends and issues” before acting.
It also vowed to consider talking points raised by the Virtual Asset Committee, a government advisory body that answers to the FSC.
The BOK, meanwhile, is more “reluctant” to act. It has gone on the record as stating that it is “cautious about investing in virtual assets,” as they “do not meet the IMF’s foreign exchange reserve requirements.”
The bank has also claimed that “high price volatility” means BTC and other tokens may not be “in line with the purpose of managing foreign exchange reserves.”
South Korea’s financial authorities tighten AML controls to address new money laundering risks in the crypto sector.#SouthKorea #CryptoLawshttps://t.co/2BlRNYWfxR
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The FSC has taken a different stance, noting that the Virtual Asset Committee has reported on “the possibility of stockpiling digital assets” and “setting the standards for stockpiling” crypto.
It has promised to “closely monitor global trends” and “quickly establish a regulatory system” for crypto in South Korea.
The National Pension Service appears keen to distance itself from decision-making on what is becoming an increasingly sensitive matter.
Cautious Approach
The service said it had “not yet reviewed investing in [crypto] as strategic assets,” adding that it could not form a position on the subject without a ruling from its fund management committee.
And the Korea Investment Corporation, South Korea’s sovereign wealth fund, has said it would refuse to act before Seoul established “legal” measures on BTC-buying. The corporation said:
“We plan to review whether or not we will invest [in BTC] after future legislation or legal amendments take effect.”
The media outlet did, however, point out that both the pension service and the sovereign wealth fund have invested in BTC-related US stocks, buying shares in companies like Coinbase and MicroStrategy (aka Strategy).
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