South Korea is to have its very first cryptocurrency exchange-traded funds (ETFs) through the Kookmin Bank. Crypto ETFs track the value of a particular asset or collection of assets. Basically, it’s a fund consisting of cryptocurrencies that are traded on a daily basis just like common stocks.
The Kookmin Bank has formed a unit – Digital Asset Management Preparatory Committee to help achieve its crypto ETFs goal. The committee will help determine product and strategy capabilities in regards to digital assets and artificial intelligence investment funds. It will also look into risk and compliance issues for the investment funds. The bank plans on rolling out a product made up of digital asset ETFs and a crypto-themed equity fund.
Honggun Kim, the Head of Index Quant Management at Kookmin Bank, confirmed that they would be launching a virtual asset-themed equity fun. The financial institution also plans to publish periodicals.
It should be noted that the South Korean government has banned local banks from offering cryptocurrency trading services directly. But financial institutions can offer indirect digital asset opportunities through partnerships with exchanges.
Sohn Byung-doo, the CEO of Korea Exchange (KRX) believes the East Asian country should fully embrace the crypto industry. He highlighted that five million locals are investors and the daily trade volume in the country’s crypto market has increased significantly. Byung-doo also called for a comprehensive regulation in the market. He says regulation will grant more investor protection and transaction support. The executive believes now is a good time for exchanges to compete directly with exchanges in other countries.