New rules for crypto exchanges in South Korea
South Korean regulators are considering introducing ownership limits for cryptocurrency exchanges. The head of the Financial Services Commission (FSC) of the country said that this measure is in active discussion ahead of the adoption of the Digital Asset Basic Act, scheduled for mid-February.
The South Korean government seeks to strengthen control over the cryptocurrency market after a series of high-profile bankruptcies and scandals involving local crypto exchanges in 2022. The collapse of the Terraform Labs platform and the crash of the UST stablecoin have dealt a serious blow to investor confidence in the crypto industry in the country.
It is assumed that the new rules will restrict the ownership share of crypto exchanges for individuals and companies in order to prevent excessive concentration of power. The exact parameters of these restrictions are still being worked out by regulators and lawmakers.
Such measures are intended to increase the transparency and accountability of the South Korean cryptocurrency market, making it more stable and secure for investors. At the same time, they may limit the ability of large players to increase their influence, which will affect competition in the industry.
Expert opinion
Restricting the ownership of crypto exchanges is a common measure used in many countries seeking to strengthen regulation of this sector. South Korea, being one of the world leaders in the level of population participation in cryptocurrency operations, is quite logically moving in this direction.
Such rules help reduce the risks of concentration of power and prevent market manipulation by large players. At the same time, they can lead to certain structural changes in the industry, forcing exchanges to adapt to new conditions. Overall, this is another step towards the formation of a mature and stable crypto ecosystem in South Korea.