The FSC chair of South Korea rejects the idea of stockpiling Bitcoin, citing volatility and economic uncertainties.
South Korea’s FSC Chairman Rejects Bitcoin Reserve Proposal
The head of South Korea’s Financial Services Commission (FSC), Kim Byung-hwan, dismissed the idea of creating a national Bitcoin reserve. During a TV interview on November 24, he stated that South Korea currently sees no need to stockpile cryptocurrencies like Bitcoin, contrary to plans proposed by U.S. President-elect Donald Trump.
Observing Global Crypto Policies
Kim emphasized that South Korea would monitor global developments, particularly in response to U.S. crypto strategies, before deciding its course.
“The level to which we will foster [the crypto industry] in the future will ultimately be a matter of judgment,” he said. “It will be based on whether other countries’ stances change due to US government policy.”
Focus on Investor Protection
Kim highlighted the importance of protecting domestic investors over adopting cryptocurrencies as reserve assets. He suggested that the FSC is not yet convinced of Bitcoin’s potential to benefit the nation’s economy.
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“We consider stock market investments to be an important economic factor, but we are not sure if cryptoassets can really have a positive effect on the economy,” Kim explained.
Volatility and Risks of Crypto Markets
The FSC views the crypto market’s volatility as a significant concern. Kim stressed that the regulator would investigate allegations of unfair trading while assessing whether to foster the industry or prioritize investor protection.
“Prices are rising rapidly in a short period of time, and the market itself is highly volatile,” he noted.
Changing Perspectives Amid New Regulations
Kim acknowledged a shift in perspectives following the implementation of the Virtual Asset Protection Act in July. However, he cautioned against rushing to integrate crypto into the mainstream financial system, citing lingering concerns about its risks.
“There were concerns that Bitcoin was not worth fostering for a long time,” Kim said. “For now, our priority is working out how to connect this market to the existing financial system.”
Regulators and Lawmakers Diverge
While the FSC adopts a cautious stance, some lawmakers advocate for more progressive crypto policies. Politicians have called for allowing companies to hold cryptocurrencies on their balance sheets and accelerating Bitcoin spot ETF approvals, but the FSC continues to urge caution.
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