Key Highlights
- The KRX plans to launch new exchange-traded funds (ETFs) and derivative products linked to virtual assets.
- The exchange aims to move toward a 24-hour trading system to increase global market accessibility.
- An artificial intelligence-based monitoring system will be introduced to detect and address unfair trading practices.
Jeong Eun-bo, chairman of the Korea Exchange (KRX), said on January 2 during a new year opening ceremony in Seoul that the exchange plans to overhaul the local capital market.
According to reports, the KRX is considering extended trading hours and introducing investment products linked to virtual assets to address the long-standing Korea Discount. The goal is to modernize the domestic financial sector and match global premium markets as the KOSPI exceeds record milestones.
A digital-focused financial ecosystem
On the first trading day of 2026, Jeong outlined a vision for a digital-focused financial ecosystem. A key aspect of this expansion is integrating the traditional financial sector with the growing digital asset economy.
Jeong said the exchange would support the launch of new investment options, including exchange-traded funds (ETFs) and derivative products that contain virtual assets. This signals a major change in the exchange’s stance on financial products related to cryptocurrencies, which have faced strict regulations in South Korea.
A 24-hour trading system
In addition to diversifying products, the KRX plans to move away from standard market hours. Jeong said the exchange would gradually introduce a 24-hour trading system to cater to global investors and reflect the continuous nature of modern digital markets.
To handle the risks that come with increased volatility and longer hours, the exchange plans to set up an artificial intelligence-based monitoring system. This technology will work alongside a response team created last year to detect and eliminate stock price manipulation and other unfair trading practices.
Recovery and normalization of the capital market
The announcement comes as the South Korean market shows signs of recovery. According to Jeong, the capital market is currently on track for normalization, with the benchmark KOSPI surpassing 4,000 and other market indexes, such as the price-to-earnings ratio (PER), reflecting improvements.
South Korean stocks have long suffered from the Korea Discount, which refers to the lower valuations of local companies compared to their global counterparts, largely due to North Korean tensions, corporate governance issues, and restrictive trading environments.
The implications of these changes indicate a blending of traditional finance and the virtual asset industry in East Asia. By introducing crypto-linked ETFs and derivatives, the KRX aims to attract institutional capital that has previously looked for digital asset exposure in foreign markets.
The move to 24-hour trading could also lead to broader changes in how local brokerages function, potentially boosting liquidity but necessitating stronger consumer protection measures.
The KRX is trying to turn the local capital market into a global hub by adopting digital assets and flexible trading schedules. Jeong stated that the local market should overcome the Korea Discount and progress into the premium market, indicating that the integration of virtual assets is now crucial to South Korea.
Also Read: South Korea Seeks to Cap Ownership Structure of Crypto Exchanges
