South Korea to Cap Major Shareholders of Crypto Exchanges at 20%

According to South Korean regulators and lawmakers, the cap will be set in the Digital Asset Basic Act, giving Upbit and Bithumb three years and smaller exchanges six years to comply with new ownership limits.

Summary

South Korean regulators and lawmakers agreed to cap major shareholders of crypto exchanges at 20%, with possible exceptions up to 34%, to be included in the Digital Asset Basic Act. The plan sets a three-year grace period for major platforms such as Upbit and Bithumb to restructure and six years for smaller exchanges. Current stakes exceed the proposed limits: Bithumb Holdings owns 73% of Bithumb, and Binance holds 67% of Gopax. The measure awaits enactment and is intended to curb concentration and strengthen governance.

Terms & Concepts
  • Digital Asset Basic Act: A proposed South Korean legislative framework to regulate digital assets, including exchange oversight, ownership rules, and investor protection.
  • Crypto exchange: A platform where users buy, sell, and trade cryptocurrencies against fiat or other digital assets.
  • Grace period: The time allowed to meet new regulatory requirements before enforcement or penalties begin.