SOUTH KOREA Law and Practice Contributed by: Jongbaek Park, Seungil Hong, Seyeong Im and Eric Jeong, Bae, Kim & Lee LLC
6. Marketplaces, Exchanges and Trading Platforms 6.1 Permissible Trading Platforms In Korea, financial investment products are listed and traded on the KRX and the new alternative trading system (ATS). Unlisted stocks are traded on the over- the-counter trading platform. Korea’s first ATS, Nextrade, launched on 4 March 2025. This marks the first operation of a multiple and competition-based stock trading system in the capital market in Korea. With respect to virtual assets, approximately 28 regis - tered VASPs are operating cryptocurrency exchanges. Virtual assets that do not constitute financial invest - ment products are traded on these exchanges. 6.2 Regulation of Different Asset Classes Financial investment products that are classified into securities (such as stocks, bonds and trust interests) and derivatives are mainly regulated by the FSCMA. Meanwhile, virtual assets, which are electronic certifi - cates that have an economic value and that can be traded or transferred electronically, are regulated by the VAUPA. Financial investment service providers must obtain the relevant licences under the FSCMA. The FSCMA also prohibits insider trading, market manipulation and other unfair trading activities related to financial investment products. When it comes to virtual assets, VASPs have to reg - ister with the financial authority. Following the enact - ment of the VAUPA, insider trading, market manipu - lation and unfair trading activities related to virtual assets are now expressly prohibited. Although regulations for virtual assets have been introduced gradually, the regulation on the transaction of financial investment products under the FSCMA is relatively more stringent than the regulation on the transaction of virtual assets. For example, public offer - ing or trading of listed securities is subject to vari -
ous disclosure regulations and increased regulatory scrutiny. 6.3 Impact of the Emergence of Cryptocurrency Exchanges The emergence of cryptocurrency exchanges has led to the enactment of the VAUPA, which came into effect on 19 July 2024. The VAUPA aims to protect virtual asset users and establish a sound order in the virtual asset market. The VAUPA contains definitions of virtual assets and non-virtual assets. It authorises VASPs to keep users’ deposits and virtual assets safe and to manage them. The VAUPA also establishes legal grounds to impose penalties and sanctions on unfair trading activities, such as the use of material non-public information and market manipulation. 6.4 Listing Standards In terms of the listing rules for the KRX, quantitative
requirements such as: • the operating history; • capital size; • share distribution; • financial requirement;
• restriction on stocks transfer; • corporate governance; and • accounting standards,
are reviewed during the listing approval process. In addition, qualitative requirements such as: • company continuity; • management transparency; and
• investor protection, are also considered.
In terms of the virtual asset market, each VASP has its own listing regulations and standards. The level of security, sustainability, and expertise and capability of the issuer will generally be considered primarily.
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