South Korea’s leading Kookmin Bank or KB is gearing to launch cryptocurrency exchange-traded funds [ETFs] and futures products to retail investors and is in the course of charting history by becoming the first bank in the East Asian nation to do the same.
Confirming the news, the bank’s head of index quant management Honggun Kim quoted, “We will launch a virtual asset-themed equity fund, etc. We plan to publish periodicals as well.”
As per a Monday announcement, KB notified that it had formed a Digital Asset Management Preparatory Committee to establish product and strategy capabilities of virtual assets and artificial intelligence investment funds. Apart from the product’s launch, the committee would study risk and compliance issues for the investment funds.
As earlier reported in TronWeekly, the news follows after Singapore’s largest bank DBS outlined its intention to launch new retail crypto investment products at the tail end of the year. On Feb. 14, the Bank’s CEO Piyush Gupta stated that DBS would focus on ramping up its crypto operations in 2022.
Having said that, the massive popularity of crypto exchange-traded funds in South Korea is on a steady rise.
South Korea’s retail investors driving the demand of crypto ETFs
As per data obtained from Samsung Asset Management which launched two of the ETFs, there are in total eight crypto-focused ETFs currently available for investors as of Jan. 19, 2022, which draws inflows of a staggering $1 billion. The nation’s big asset management firms are releasing their investment products, tracking Bitcoin and other crypto assets.
The new ETFs comprise Samsung Asset Management’s KODEX K-Metaverse Active, KB Asset Management’s KB STAR iSelect Metaverse, NH Amundi Asset Management’s Hanaro Fn K-Metaverse MZ, and Mirae Asset Global Investment’s Tiger Fn Metaverse. Some of these ETFs come from tech firms, chipmakers, and stocks related to South Korea’s entertainment industry.
The growing appreciation for digital currencies in South Korea is just one example of the burgeoning interest among Asian investors that have several options of financial instruments underpinned by blockchain technology.
Referencing a recent Euroclear report, Rahul Sen Sharma, of Indxx, a financial service firm, said demand in Asia-Pacific for ETFs is set to surge from $1.5 trillion to $5 trillion over the next five years.