National Pension Service Fund Managers Face No Internal Curbs or Checks on Crypto Trading
Employees at the National Pension Service's investment management arm face strict limits on trading stocks and other financial investment products, but can trade cryptocurrencies without separate rules or compliance checks, Money Today reported on October 14.According to data the National Pension Service submitted to Democratic Party lawmaker Heo Jong-sik, the fund management division has not established internal rules restricting employee holdings or trading of cryptocurrencies such as Bitcoin. It also does not conduct separate inspections to determine employees' actual crypto investments.That stands in contrast to the controls applied to conventional financial investment products. Employees at the fund management division are barred from trading individual domestic and overseas stocks, derivatives and equity-linked bonds in their own names to prevent improper gains from material nonpublic information obtained through their work. They must report exchange-traded fund holdings within 10 business days of starting work, and trading financial investment products during working hours is also prohibited.To verify compliance, the National Pension Service annually reviews financial product trading records for employees at the fund management division, the audit office, the compliance support office and the National Pension Research Institute. The reviews also cover spouses and minor direct descendants. Those checks, conducted six times from 2020 through June 2025, uncovered 194 violations.Of the nine cases detected last year, seven involved trades in restricted ETFs, including funds tracking specific industry indexes. One case involved failing to report a financial product trade to a compliance monitor on time, and another involved placing an order for a permitted financial investment product during working hours. Cryptocurrencies, by contrast, are excluded from those reviews, making it difficult to determine whether employees hold them or how actively they trade them.The National Pension Service does not currently buy cryptocurrencies directly, but it has indirect exposure to the market through investments in shares of related companies. Those include Coinbase, the U.S. crypto exchange, and Strategy, the Bitcoin treasury company formerly known as MicroStrategy. That has prompted calls for standards to manage potential conflicts of interest tied to crypto-related investments.The government revised the Public Service Ethics Act in 2023 to require officials subject to asset registration to disclose their cryptocurrency holdings. At the National Pension Service, however, that requirement applies only to the chairman, standing directors and the standing auditor. Working-level employees who actually manage the fund are not covered, prompting calls for separate standards requiring disclosure of crypto holdings and trades, as well as regular inspections.