Lee Eok-won: “Single-stock leveraged ETFs were not launched at the Blue House’s direction; I apologize for the harm caused”

[Financial News] Financial Services Commission Chairman Lee Eok-won appeared at a National Assembly audit and said the Blue House had not directed the launch of single-stock leveraged exchange-traded funds (ETFs), while apologizing for increased stock market volatility. He said the government is in final-stage consultations on submitting its bill for the General Act on Digital Assets, whose legislation has been delayed since last year.
Appearing at the Financial Services Commission audit held by the National Assembly’s Political Affairs Committee in Yeouido, Seoul, on the 8th, Lee responded to a question from Rep. Park Jun-tae of the People Power Party about the circumstances surrounding the introduction of single-stock leveraged ETFs, saying, “They were not introduced at the Blue House’s direction.”
“We made the decision after hearing a range of views,” Lee said, explaining, “There have been views asking why people can invest in single-stock leveraged ETFs overseas but not in Korea.”
Regarding a report by a foreign investment bank (IB) that estimated individual investors had lost about 54 trillion won through single-stock leveraged ETFs, Lee said, “It is not an official report by that company but unofficial market commentary. Its actual contents are also inaccurate.”
Addressing the increased stock market volatility since the product’s introduction, Lee bowed his head and said, “I am sorry for the losses, concerns and harm caused as a result.”
Questions were also raised about the General Act on Digital Assets (Phase 2 legislation), which includes regulations on virtual assets such as won-denominated stablecoins. When Rep. Lee Kang-il of the Democratic Party of Korea pointed out that domestic legislation was lagging behind the global competition to institutionalize virtual asset markets, Lee replied, “We have prepared the contents of the General Act on Digital Assets and are in final-stage consultations.”
“We will move the consultations forward quickly and set out the overall direction for how to lead the industry and the market,” he continued. “We will devise various measures to ensure the market can grow safely and robustly without falling behind global trends.”
[email protected] Im Sang-hyeok Reporter