South Korea’s top financial regulator has proposed easing restrictions on ownership of financial holding companies in fintech platforms from the current 5% to 15%, a first such since the ownership limit was introduced in 2000.
The Financial Services Commission (FSC) is also considering allowing businesses and unincorporated organizations to trade cryptocurrencies at home, starting in the first half of this year.
On Wednesday, the FSC unveiled a set of such policy initiatives for 2025.
RULES REGARDING FINTECH OPERATORS
Under current law, a financial holding company’s stake in a fintech platform is limited to 5%, unless it is its subsidiary, which it controls more than 50%.
“(A relaxation of their ownership limits) will meet the needs of both fintech companies looking to attract investment, while retaining management rights and financial holding companies that want to collaborate with fintech companies through a appropriate level of investment,” said an FSC official.
For fintech units classified as subsidiaries of holding companies, the regulator is seeking to allow them to control other financial services companies, such as robo-advisors that provide personalized financial advice and online investment services.
CRYPTOCURRENCY TRADE
Investors in the domestic digital coin market are required to open Korean won-denominated accounts under their real names at a local bank.
The rules virtually blocked institutions’ digital currency trading in their countries, as local banks were reluctant to open corporate accounts linked to crypto investments for fear of going against anti-money laundering guidelines. ‘money.
A relaxation of the rules, which will be introduced in stages, will allow companies, university foundations and municipalities to convert digital money into physical cash in the country.
At the same time, the FSC said it would continue to ban local investors from trading bitcoin spot exchange-traded funds, citing a lack of investor protection systems.
In 2024, South Korea passed virtual asset legislation to bring cryptocurrency markets under regulatory control to protect investors after a series of alleged cryptocurrency fraud cases in recent years.
It is currently developing follow-up regulatory measures regarding the issuance and circulation of digital assets.
Write to Hyun-Woo Kang at [email protected]
Yeonhee Kim edited this article.
