It appears that South Korea is bowing out of the race for bitcoin futures trading, leaving the field wide open to the Americans and Japanese. This is not because established financial companies are reluctant to offer the new instruments in the bitcoin obsessed country, but due to another official ban.
FSC Futures Ban
After securities brokers in South Korea were already gearing up to introduce bitcoin futures trading to their clients, the country’s top financial regulators have decided to place a ban on the practice. The Financial Services Commission’s issued this directive on December 5, applicable to all the members of the Korea Financial Investment Association.
In response, Korean brokers such as eBest Investment & Securities and Shinhan Financial Investment had to cancel pre-planned client seminars for bitcoin futures trading, this according to a report by The Korea Herald.
South Korean authorities have already banned the practice of ICO, started looking into taxing bitcoin payments and established a governmental task force to regulate trading. And the local industry is not willing to take all this laying down.
Kim Jin-hwa, the former head of Korbit is reportedly working on bringing together the country’s leading bitcoin venues Bithumb, Coinone and Korbit to establish an association to represent the interests of the industry. “An entry of new technology into Korea is hamstrung by the regulation,” he told the newspaper.
The Race Is On
While South Korea might be leaving the race for now, other countries are moving full steam ahead with bitcoin futures trading.
Cboe is preparing to launch its offering on Sunday, and CME Group will follow the week after. Meanwhile in Japan the Tokyo Financial Exchange won’t be left behind for long and is now planning to launch its own bitcoin futures.
Retail brokers have already started to prepare their clients for the new exchange-traded bitcoin instruments, beginning with TD Ameritrade and Ally Invest.
What does a ban on bitcoin futures trading mean for Korean investors? Tell us what you think in the comments section below.
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