The SEC has approved an Ethereum spot ETF, following a Bitcoin spot ETF, but it won't be available in South Korea. Korean financial authorities say such ETFs violate current laws, potentially making Korea a "digital asset Galapagos" that lags behind global trends.

The Financial Services Commission (FSC) prohibits transactions related to Ethereum and Bitcoin spot ETFs, citing the Capital Market Act. This Act doesn't list cryptocurrencies as underlying assets, thus prohibiting domestic securities firms from brokering these ETFs.

The FSC's stance is based on the 2017 government position against institutional investments in virtual currencies. Despite the new administration in 2022, this stance remains unchanged.

Opposition exists, with the Democratic Party of Korea pledging to institutionalize digital assets and amend the Capital Markets Act. They argue that prohibiting spot ETFs disadvantages Korea and plan to push for changes when the National Assembly opens.

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