Korea's won goes to 24-hour trading with its spot brokerage still split between two firms

On this record, no regulator is holding back an entrant, because nobody has tried to enter. The ministry has no application to approve or refuse ^[5]. At the conversion Seoul Economic Daily used, the capital floor comes to about $3.6 million, which is small for an international broker ^[6]. A foreign corporation is assessed on the operating funds of its Korean branch instead ^[7].

The empty file has more than one explanation. The first is volume. Spot flow shared by two incumbents may never have been enough to pay for a third desk. Round-the-clock trading changes that only if it brings more institutions, at home and abroad, into the won, and some within and around the central bank are making that case, according to the paper ^[1][15]. The second is how the market is built. Korea's interbank trading has long been routed through brokers, and those brokers helped form and stabilize it ^[9], so a newcomer has to win relationships the two incumbents already hold. The third is patience. Overseas brokers already operate in Korea in products such as FX swaps, which are brokered differently from spot ^[10]. The paper reports that their incentive to enter spot would rise as volume grows and access improves ^[16].

I think the third explanation fits the evidence best. A broker already active in won swaps would have systems and counterparties in place, and the capital floor would not stop it. What it would lack is enough spot flow to take on two firms that have held their licenses for almost 28 and 26 years ^[12][13]. The counter-case is that the rules themselves discourage filings. Brokers that expect a slow review, or sense a ministry comfortable with two incumbents, would not apply. In that case a zero count would measure discouragement. The source does not include an account from any broker that considered a spot license and decided against it. One such account that blamed the review process, and not the volume, would make this view wrong.

The incumbents' side of the argument is also on record. One foreign exchange market official, not named in the report, pointed to Japan and Australia as cases where overseas brokers' influence grew after their markets opened ^[11]. Because domestic brokers contributed to stability and development, the official said, Korea's opening needs a soft landing that lets existing firms adapt instead of abrupt competition ^[11].