South Korea's regulators require investment institutions to control their exposure to CEX and Strategy and other encryption-related companies.

On July 23, according to the Korea Herald, the Financial Supervisory Service (FSS) of South Korea recently instructed local asset management companies to adjust their exchange-traded funds (ETF) to limit exposure to crypto-related companies such as CEX and Strategy. The regulator stated that asset management companies must comply with the administrative guidelines issued by the Financial Services Commission (FSC) of South Korea in 2017, which prohibit regulated financial institutions from holding, purchasing, or making equity investments in virtual assets. This directive from local regulators has triggered complaints from domestic financial participants, who believe it creates an unfair competitive environment, as retail investors can purchase U.S. ETFs by investing in crypto asset companies. An official from the Financial Supervisory Service stated that even if regulatory provisions change in the U.S. and Korea, institutions must adhere to existing guidelines until new regulations are enacted. The Financial Supervisory Service is responsible for regulating South Korea's financial industry, focusing on the day-to-day actual supervision of various financial entities. It is the executive body of South Korea's highest financial regulatory authority, the Financial Services Commission (FSC).