The world’s largest futures exchanges, CBOE and CME Group, have given their imprimatur to Bitcoin futures trading, but South Korea wants none of it. The South Korean government seems to be struggling to understand these currencies which are unlike anything else in the financial world. Recently, South Korea has announced its plans to begin regulating digital currency exchanges and taxing cryptocurrency profits. The country has also banned initial coin offerings (ICOs).
Citizens of the Asian nation have been aggressive buyers of Bitcoin and other digital currencies, often paying substantial premiums over the price on Western exchanges. Tony Lyu, CEO of South Korean exchange Korbit, explained:
“Word just spreads really fast in Korea. Once people are invested, they want everyone else to join the party. There’s been this huge, almost a community movement around this.”
If CBOE and CME Group don’t sound familiar, your average person-in-the-street is certain to know this one: Nasdaq. The well-known tech exchange is preparing to offer Bitcoin futures next summer. In Japan, the world’s largest Bitcoin market, the Tokyo Financial Exchange is laying a foundation for offering futures as well.
South Korean exchanges were also preparing to do so, until South Korea’s regulators nixed the idea. On December 5, the country’s Financial Services Commission ordered members of the Korea Financial Investment Association to stand down their plans to offer Bitcoin futures. Two Korean securities firms had already planned seminars for Bitcoin futures investors.