Despite tighter oversight from South Korea’s financial authorities, leverage-pushed “crypto lending” services resurface all the draw by domestic exchanges.
Platforms cherish Upbit, Bithumb, and Coinone are reviving or reshaping the controversial products below newly issued government pointers, signaling a cautious but indispensable comeback.
Coinone Launches “Coin Borrowing”
On Monday, Coinone, South Korea’s third-largest cryptocurrency exchange, launched its unique cryptocurrency procuring and selling carrier, “coin lending.” The rollout comes unbiased two months after rivals Upbit and Bithumb launched identical services in July.
The product lets customers borrow cryptocurrency in opposition to Korean won collateral, enabling leverage-pushed procuring and selling recommendations. In discover, this entails immediate-selling—borrowing crypto, selling at market costs, and repurchasing later at a low cost if costs fall.
Coinone emphasised that the carrier strictly follows the Executive’s, i.e., Monetary Services and products Fee (FSC), lending pointers. Below the guidelines, particular person borrowing limits mirror fairness immediate-selling frameworks—$22,000 (KRW 30 million) to $51,000 (KRW 70 million), reckoning on the user.
Clients can pledge as little as $37 by the carrier and borrow up to 82% of their collateral, field to the $22,000 cap. At originate, most productive Bitcoin is supported.
Upbit and Bithumb Adjust Their Services and products
Replace leader Upbit reinstated its lending program final week, enhancing phrases to fulfill the FSC’s necessities. Its most collateral cap fell by 25%—from $37,000 to $28,000.
Bithumb, the nation’s 2d-largest exchange, continues working below its historical structure but confirmed ongoing revisions.
“We fully label the intent of the FSC and the DAXA pointers,” a Bithumb spokesperson mentioned, referring to the Digital Asset eXchange Affiliation. “We are reviewing borrowing limits, ratios, and liquidation necessities to be clear investor protection and market steadiness. Our priority is to transition the carrier smoothly while minimizing user disruption.”
Regulators Push Stronger Safeguards
The FSC launched its pointers earlier this month in accordance with concerns over investor risk and shameful leverage. Regulators clarified that lending services must no longer operate as unchecked, high-risk products.
Exchanges must now provide loans most productive from their reserves and restrict borrowing to well-organized-cap cryptocurrencies. Borrowing limits are capped for every particular person, and customers must full on-line schooling applications and pass suitability assessments before accessing the carrier. To guard retail traders, authorities moreover place a most annualized ardour payment of 20 p.c and reinforced disclosure tasks.
Officials mentioned the framework is designed to strike a steadiness—permitting innovation in digital asset markets while guaranteeing user protection and curbing reckless hypothesis.
In conserving with CoinGecko, six South Korean-basically based totally mostly exchanges—including Upbit, Bithumb, and Coinone—collectively assignment $5.26 billion in day-to-day procuring and selling quantity.
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