Digital Asset Financial Innovation Seminar Concludes

The Korea Fintech Industry Association (Chairman Kim Jong-hyun, CEO of Kukon, hereinafter referred to as the Fintech Association) held a National Assembly seminar titled "Case Studies and Response Strategies for Financial Innovation in Digital Assets" on October 10 (Thursday) at 2 PM in the large conference room on the 3rd floor of Post Tower. This seminar was co-hosted by Democratic Party lawmakers Min Byung-deok and Ahn Do-geol, organized by the Fintech Association, and sponsored by FN Guide and Populous.

As the combination of digital assets and traditional finance rapidly expands in the global financial market, this seminar aimed to examine the response direction and institutional challenges of the domestic financial industry through case studies of financial innovation in digital assets, and to discuss the policy and legislative tasks necessary for future discussions on the second phase of digital asset legislation. Attendees included representatives from the National Assembly, the financial sector, the legal community, academia, and the fintech and digital asset industries.

In his opening remarks, Democratic Party lawmaker Min Byung-deok stated, "What is important is not only to keep pace with the speed of innovation but also to consider what standards we will use to design the market and ensure investor protection and industrial competitiveness." He also emphasized, "Balanced legislation is needed to build market trust without hindering the growth of the industry, and the second phase of digital asset legislation should be carried out in this direction." Furthermore, he stated, "As a member of the National Assembly's Political Affairs Committee, I will responsibly engage in discussions to promote the healthy development of the digital asset market, protect investors, and strengthen the competitiveness of the domestic financial industry."

Following this, Democratic Party lawmaker Ahn Do-geol remarked, "While major countries are seizing the financial market combined with digital assets, our country continues to experience institutional gaps, leading to the outflow of domestic investors' funds to overseas and unregulated sectors, as well as the loss of growth opportunities for innovative companies." He further emphasized, "The institutionalization of digital asset financial products requires a balanced institutional design that includes safety measures such as index calculation systems and investor disclosures, considering price volatility, market time lags, and on-chain risks."

Chairman Kim Jong-hyun of the Korea Fintech Industry Association stated in his congratulatory speech, "For the changes in digital asset finance to lead to actual industrial growth, clear institutional standards and stable market infrastructure must be established alongside the innovative efforts of companies." He also mentioned, "The association will convey the voices from the field and support cooperation among industries so that financial companies and fintech/digital asset companies can create new collaboration opportunities by leveraging their respective strengths."

Next, Oh Jong-wook, chairman of the Digital Asset Infrastructure Council under the Fintech Association, stated, "For digital asset finance to establish itself as a trusted market, foundational infrastructure such as custody, pricing, trading, settlement, and liquidity provision must be established first," and added, "The council will gather the field experiences of financial companies and fintech and digital asset firms to develop practical standards and faithfully convey them to institutional and policy discussions."

The seminar featured a keynote speech, two presentations, and a panel discussion. The keynote speech was delivered by attorney Kim Hyo-bong from the law firm Taepyeongyang, who discussed "Global Regulatory Trends in Digital Assets," presenting the recent global trends of digital assets merging with traditional financial markets and the necessary improvements in domestic regulations. Attorney Kim suggested, "It is necessary to prepare a comprehensive institutional blueprint regarding the scope of digital asset operations of existing financial institutions and the dual licensing issue, as well as the underlying assets, custody, and pricing indices of digital asset ETFs." He also emphasized, "In the future, it is essential to establish a new regulatory framework and industry feedback procedures that align with an environment where various financial services are linked around wallets and super apps."

Following this, researcher Lim Seung-jin from FN Guide presented on "The Development and Institutionalization of Digital Asset ETFs," discussing the trend of global digital asset listed products evolving to capture on-chain returns and the institutional and infrastructural tasks for domestic adoption. Researcher Lim proposed, "To introduce domestic digital asset spot ETFs, it is necessary to clearly recognize digital assets as underlying assets under the Capital Markets Act and to establish a reliable pricing index based on multiple exchanges, along with professional custody, creation/redemption, and market participant systems." He also emphasized, "Initially, it would be advisable to introduce single-asset spot ETFs, which are relatively easier to control in terms of risk, and gradually expand to multi-asset and staking/on-chain return products after operational experience and control mechanisms are accumulated."

The second presentation was given by Bok Jin-sol, head of research at Populous, on "Vaults: On-Chain Infrastructure for Next-Generation Asset Management," discussing the structure and development trends of on-chain vaults that manage funds using smart contracts, as well as key risks. Head Bok explained, "On-chain vaults are evolving to deposit user funds into smart contracts for lending, staking, RWA, etc., with curators responsible for asset allocation and risk/liquidity management." He also emphasized the need to examine institutional issues related to securities, which may arise from the discretion level of professional curators, alongside smart contracts, oracle, collateral, and liquidity risks.

In the panel discussion, Professor Lee Jong-seob from Seoul National University served as the moderator, with participation from ▲ Attorney Kim Hyo-bong from the law firm Taepyeongyang ▲ Kim Wan-sung, head of department at Koscom ▲ Lim Min-ho, senior manager at Mirae Asset Securities ▲ Oh Jong-wook, chairman of the Digital Asset Infrastructure Council ▲ Kim Nam-woong, CEO of Populous, discussing ways to secure the competitiveness of the domestic financial industry in response to global financial innovation trends such as digital asset ETFs and on-chain finance, as well as institutional tasks including the second phase of digital asset legislation.

During this seminar, there was a consensus on the need to organize related systems and infrastructure such as custody, pricing indices, market surveillance, and investor protection for the institutionalization of digital asset ETFs and on-chain finance, and to ensure a balanced institutional design that reflects the demands of the industry during the second phase of digital asset legislation.

The Fintech Association plans to continue supporting the innovation of digital asset finance to lead to actual industrial growth and competitiveness based on stable institutions and market infrastructure through ongoing discussions with the National Assembly, financial authorities, the financial sector, and the fintech and digital asset industries.

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