South Korea Weighs 15–20% Ownership Cap for Crypto Exchanges
South Korea’s financial regulator is getting closer to setting ownership limits for local cryptocurrency exchanges. This move shows...
Quick overview
- South Korea's financial regulator is moving towards establishing ownership limits for local cryptocurrency exchanges, aiming to treat them as integral to the financial system.
- The proposed limits would cap controlling shareholders' stakes at 15 to 20 percent to mitigate governance risks associated with concentrated ownership.
- This initiative is part of a broader effort to enhance oversight in the crypto sector, aligning it more closely with traditional financial institutions.
- Major exchanges are pushing back against these limits, citing potential impacts on competitiveness and the need for divestments.
South Korea’s financial regulator is getting closer to setting ownership limits for local cryptocurrency exchanges. This move shows the country is starting to treat digital asset platforms as an important part of its financial system.
The Financial Services Commission (FSC) is considering a plan to limit controlling shareholders’ stakes to 15 to 20 percent, according to FSC Chairman Lee Eog-weon. This step aims to reduce governance risks as crypto exchanges become more important in South Korea’s financial system.
Why Ownership Limits Are Being Considered
Lee pointed out that current rules mainly cover anti-money laundering and user protection, but do not address governance much. The new Digital Asset Basic Act would change exchanges from a renewable three-year notification system to a permanent authorization system.
This change would make exchanges more like public financial institutions, raising expectations for transparency, accountability, and control.
🇰🇷 SOUTH KOREA OPENS CRYPTO ACCESS
Bank of Korea Governor Chang-yong says residents are now allowed to invest in overseas crypto due to market pressure.
Regulators are also considering a new registration system that would allow domestic institutions to issue virtual assets. pic.twitter.com/kNXMy0gc4M
— Coin Bureau (@coinbureau) January 27, 2026
Key risks cited by regulators include:
- Conflicts of interest from concentrated ownership
- Weaker market integrity during periods of stress
- Governance standards lagging behind traditional securities exchanges
South Korea already applies ownership caps to stock exchanges and alternative trading systems, and regulators argue similar rules are reasonable for crypto platforms with comparable market influence.
Industry Pushback and Market Implications
Major exchanges have pushed back strongly. Upbit operator Dunamu is more than 28% owned by founder-related entities, while Coinone’s founder controls roughly 53%. A strict cap would likely force large-scale divestments.
Industry groups and some lawmakers say these limits are rare in other countries and could make South Korea less competitive as a digital asset center. Lee recognized these worries and said talks with the National Assembly are still happening about the details and timing.
This proposal is part of South Korea’s broader effort to increase oversight in the sector, including stricter transaction monitoring. It shows the regulator’s goal to bring crypto markets more closely in line with the traditional financial system.
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