I can give a Hapkido perspective on this, since at least at my dojang we are taught that you keep your fists closed until you reach 1 dan, at which point you can open them (and do so more and more as you go up from there). We relax it a bit for blocks (we don't teach hard blocks until 9th kup), but not for attacks.
There are two major reasons we give for emphasizing closed-fist technique in sparring:
- It prevents an injury to yourself from a jammed finger or something similar.
- It prevents you from injuring them.
In TKD there may be tournament reasons for keeping your fist closed which do not apply to HKD, but I can address these two reasons.
Injury to Self
From my perspective, once your technique gets into the dan range then it is both natural and desirable that you would open up your hands when doing the techniques where appropriate.
Assuming, of course, that your technique is good enough to justify it. Your training by that point should be good enough that the risk of injury to yourself is substantially reduced, and you can actually make a more nuanced decision about when it might be appropriate, and also are more prepared to deal with the consequences if you are wrong.
Injury to the Opponent
This mostly is involved in attacks. Here the problem is that many open handed techniques–especially if improperly aimed or if there is a mistake–can cause substantively greater damage than a fist is likely to do. It's one thing to miss a bit on a punch to the chest, it's another to screw up on something designed to hit their eyes. Especially in arts where head strikes and throws are banned, there's also less reason to employ open-handed attacks.
Here I think there is still merit in limiting your repertoire that your use while sparring.
With blocks, unless your instructor says otherwise, I'd say "go for it" since many of the safety concerns are obviated by the point that your technique has solidified a little. That said, I might have that conversation with your instructor, since he may have a set point where that becomes more allowable, or may feel that you personally aren't ready for it. On the other hand, he may also feel that now it is time to learn it and use it in a sparring context.