South Korea's FSC Proposes 15%–20% Ownership Cap for Major Shareholders of Domestic Crypto Exchanges

South Korea's Financial Services Commission (FSC) proposed capping major shareholders' stakes in domestic crypto trading platforms at 15% to 20%, KBS reported on December 30, citing the FSC's National Assembly briefing on the "Basic Digital Assets Act". The FSC classifies Korean exchanges with about 11 million users, including Upbit, Bithumb, Coinone and Korbit, as core infrastructure for virtual asset circulation and argues that a small group of founders and shareholders currently wields excessive control. Under the proposal, holdings of up to 30% would only be allowed for certain mutual funds or in special cases approved individually by the FSC, which could affect Upbit operator Dunamu, whose chairman holds about 25% of Upbit, and Bithumb, 73% owned by Bithumb Holdings Co., Ltd. Some participants in South Korea's crypto industry have criticized the plan, saying the government is attempting to impose regulation that goes beyond normal market standards.