According to a recent report issued by South Korea's Financial Services Commission (FSC), crypto funds may have similarities to traditional funds so investors may falsely believe these funds are legitimate.
According to the law, funds that attract investment from the public must be registered with the FSC.
Nonetheless, crypto funds are neither approved nor registered, the watchdog claims.
Earlier in October, the head of the country's state policy coordination office, Hong Nam-ki, said that local regulators were considering legalizing the ICO.
In November, the South Korean government will hold a meeting at which it will discuss allowing the implementation of ICO projects in the country.
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