This Tuesday, the Financial Services Commission (FSC) of South Korea announced a significant regulatory proposal aimed at limiting individual ownership of major cryptocurrency exchanges to a range of 15% to 20%. This initiative, as reported by KBS, targets platforms deemed critical for the country”s financial infrastructure, which supports over 11 million users.
The new regulation classifies prominent exchanges such as Upbit, Bithumb, Coinone, and Korbit as strategic national assets. The implications of this measure are profound, compelling current stakeholders to divest substantial portions of their holdings. For instance, the chairman of Upbit would need to liquidate up to 10% of his shares, while the required adjustments at Bithumb and Coinone could exceed 50% and 34%, respectively.
Industry stakeholders have voiced strong opposition to this proposed law, arguing that it infringes upon property rights. Critics warn that such a drastic forced sale could significantly diminish the market value of these exchanges and lead to instability within the local cryptocurrency market.
Attention is now turning to how foreign investors will react to these changes, especially as the government has yet to clarify if foreign capital will be permitted to acquire the divested shares. This uncertainty adds an extra layer of complexity in an already tumultuous regulatory landscape.
Moreover, the political climate in South Korea remains charged due to ongoing controversies surrounding stablecoin issuance and allegations of political influence in regulatory decisions. As these issues remain unresolved, the country”s regulatory framework appears precarious as it heads toward 2026.
As developments unfold, market participants are advised to stay vigilant and closely monitor the situation, given the potential ramifications for the broader cryptocurrency ecosystem.
