South Korea Rejects Bitcoin Spot ETF, What About Indonesia?

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South Korea, through the Financial Services Commission (FSC), has reaffirmed its ban on cryptocurrency-based exchange-traded fund (ETF) products. Meanwhile, regulators in Indonesia have not issued a statement regarding the potential for Bitcoin spot ETFs in the country.

Since 2017, South Korea has maintained a strict stance on crypto assets with the primary goal of stabilizing the financial market and protecting investors.

According to Cryptopotato, this position was reiterated by an FSC official, stating, "There is no change in our stance, even though ETF futures and spot Bitcoin are operational in several countries, such as Hong Kong, Germany, Canada, and now the U.S., South Korea remains unaffected by these developments."

South Korea's financial authorities oppose legislative changes to include crypto assets as underlying assets for ETFs, arguing that the U.S. financial sector has been able to withstand the collapse of virtual asset markets due to a similar ban.

Despite regulatory opposition to crypto ETFs, Kim Jun-woo, CEO of CrossAngle, has suggested the introduction of Bitcoin spot ETFs in South Korea, emphasizing their lower volatility.

He stated, "In a situation where the legal basis for regulation has disappeared, the only difference is whether to do it proactively or reluctantly follow."

Potential for Bitcoin Spot ETFs in Indonesia

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On the other hand, regulators in Indonesia have not commented on the potential for Bitcoin spot ETFs domestically.

Indonesia is currently focusing on transitioning crypto regulatory oversight from the Commodity Futures Trading Regulatory Agency (BAPPEBTI) to the Financial Services Authority (OJK), a process expected to be completed by 2025.

Although no signals have been given, industry players in Indonesia welcome the idea of Bitcoin spot ETFs. Yudhono Rawis, CEO of Tokocrypto and vice-chairman of the Indonesian Crypto Asset Traders Association (ASPAKRINDO), along with Oscar Darmawan, CEO of Indodax, welcomed the decision on BTC spot ETFs in the U.S.

Yudho sees the approval of Bitcoin spot ETFs as a potential signal for regulators in Indonesia, as crypto has become a more mature investment instrument.

He envisions an optimistic scenario, saying, "For example, if major banks in Indonesia allocate 0.1% of their balance sheets through Bitcoin ETFs, crypto market liquidity in Indonesia will increase significantly. These banks will buy Bitcoin from official crypto asset traders in Indonesia, driving significant business and industry."

Yudho also hopes that decisions related to ETFs will prompt Indonesian regulators to formulate more comprehensive regulations for the crypto industry, creating a safer and more organized environment for Indonesian crypto industry participants.

Indodax CEO, Oscar Darmawan, also responded positively to Bitcoin spot ETFs. He believes that this investment instrument will boost the adoption and liquidity of Bitcoin.

"Crypto assets, including Bitcoin, are highly volatile. Therefore, the introduction of Bitcoin spot ETFs can make Bitcoin prices more stable, easy to buy and sell because they offer higher liquidity than the traditional Bitcoin spot market," said Oscar Darmawan.

Read Too : Bitcoin Spot ETF Enters a New Phase: What You Need to Know

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