Loading...
South Korea's Regulatory Action: The Financial Services Commission (FSC) has ordered local cryptocurrency exchanges to suspend credit services to protect users and stabilize the market until new regulations are established.
Impact of Credit Services: Exchanges like Upbit and Bithumb had introduced credit services allowing users to borrow against their assets, resulting in significant borrowing but also high risks, with 13% of users facing losses due to forced liquidation.
Future Regulations: The FSC plans to create clear guidelines for leveraged cryptocurrency credit services to enhance user protection and reduce market uncertainty, while non-compliant exchanges will face inspections.
Broader Regulatory Changes: South Korea is moving towards more transparent regulations, including lifting restrictions on institutional investors and preparing for the introduction of spot cryptocurrency ETFs and a stablecoin market.
