South Korea’s financial regulator has outlined a framework that would reopen crypto markets to corporations while placing firm limits on risk exposure.
The proposal marks a significant shift after nearly nine years of restrictions on institutional participation.
FSC Sets Annual Allocation Limit
The Financial Services Commission has proposed a rule allowing listed companies and registered professional investors to allocate up to 5% of their net assets or equity capital to cryptocurrencies each year. The cap applies on an annual basis and is designed to balance market access with financial stability.
Under the draft guidelines, eligible entities would be permitted to invest directly in digital assets for the first time since South Korea effectively banned corporate crypto exposure in 2017.
Asset Eligibility Tied to Market Size
The proposal restricts investments to virtual currencies ranked within the top 20 by market capitalization on South Korea’s five major domestic exchanges. This criterion is intended to limit exposure to more liquid and established assets.
Regulators are still discussing whether certain stablecoins, including USDT, should qualify under the framework. No final decision has been announced on their inclusion.
Risk Controls Take Priority
The FSC framed the 5% ceiling as a safeguard against balance-sheet volatility. By limiting position size, regulators aim to prevent sharp market swings from materially impacting corporate financial health or amplifying systemic risk.
The approach reflects caution rather than a full liberalization, signaling that crypto exposure will be treated differently from traditional financial assets.
Timeline and Market Scope
A finalized version of the guidelines is expected as early as January or February. Actual trading activity by corporations could begin later in 2026, depending on implementation details and compliance readiness.
If enacted, the policy would open the door to roughly 3,500 listed companies and professional investment entities. For South Korea’s crypto market, the change represents the most meaningful expansion of institutional access in nearly a decade.
