- South Korea’s FSC suspends new crypto lending.
- Bithumb IPO aims for transparency.
- Market stability remains despite restrictions.
South Korea’s Financial Services Commission ordered major exchanges, including Bithumb, to halt new crypto lending by August 19, 2025, impacting digital asset operations in the region.
The regulatory suspension affects asset utilization in Korea, with potential shifts to DeFi platforms, highlighting transparency and consumer protection amid evolving market dynamics.
South Korea’s Financial Services Commission has ordered a halt to new crypto lending services, impacting major exchanges like Bithumb. This action, effective August 19, 2025, aims to address legal uncertainties within the crypto market.
The FSC and major domestic exchanges, including Bithumb, are involved in this decision. Bithumb continues with its plan for a public offering in 2025, selecting Samsung Securities for management.
The suspension affects digital assets used for lending and collateral at domestic exchanges, including BTC and ETH. Immediate market disruptions are absent, although uncertainties about future updates remain.
The financial implications include Bithumb’s focus on building market trust rather than raising funds. According to a Bithumb Executive:
“We selected Samsung Securities as our manager for initial public offering at the end of (October). We aim to go public during the second half of 2025. Our IPO is not about raising funds. Many people have doubts about cryptocurrency exchanges because they perceive them as not being transparent.”
Historically, such regulatory actions led to short-term outflows towards DeFi platforms. Ongoing market evolution requires alignment with consumer protection priorities.
Potential outcomes include increased scrutiny on compliance and transparency, impacting financial and regulatory landscapes. Bithumb, which previously processed $1.2 billion in crypto loans, has future strategies unfolding under new restrictions. For more insights on cryptocurrency trends, follow realcoingeek.
