Korea Weighs 20% Ownership Cap on Crypto Exchange Shareholders

South Korea’s financial regulator is moving to cap the stake that major shareholders can hold in cryptocurrency exchanges at 20%.

The Financial Services Commission (FSC) plans to present a government draft of the Digital Asset Basic Act as early as early next month, according to the National Assembly and financial industry sources on the 26th. The most likely path is for Yoo Dong-soo, chairman of the National Assembly’s National Policy Committee, to introduce the bill as lawmaker legislation based on the government draft and push for passage within this year. The Digital Asset Basic Act is an industry framework law governing the sector as a whole, including the scope and categories of virtual asset service providers and the issuance and circulation of stablecoins.

The central point of contention in the government draft is the ownership limit for major shareholders of exchanges. The FSC has been reviewing a plan to set the ownership ceiling for major shareholders at 20% as a general rule, regardless of an exchange’s size or market share, sources said. Also under discussion are allowing up to 34% in exceptional cases such as new entrants, and granting existing operators a three-year grace period to unwind their holdings. More recently, a compromise has emerged that would cap the exercise of voting rights instead of directly limiting ownership. Under that approach, shareholders could retain their stakes but exercise voting rights on only up to 20%.

#DigitalAssetBasicAct#CryptoRegulation#FSC#Korea#Stablecoin#CryptoExchange

Original reporting by Do Ye-ri for Seoul Economic Daily.

AI-translated from Korean. Quotes from foreignxact original wording

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Source: en.sedaily.com