Crypto exchange governance to undergo a 'major overhaul'…Naver and Mirae Asset moves may face new variables

Government moves to cap controlling shareholders’ stakes…13 years after the first domestic exchange was founded

Shift from notification to licensing

Public-interest mandate likely to be sharply strengthened

Separation of finance and industry effectively eased

Encouraging equity participation by incumbent financial firms

Direct hit to Dunamu, Bithumb and others

Spillover to exchange M&A

The government is moving to restrict the ownership stakes of controlling shareholders at domestic virtual-asset exchanges, where trading volume exceeds KRW 1,000 trillion. It marks a sweeping governance overhaul, 13 years after virtual-asset exchanges were first established in Korea. With the number of exchange users reaching 11 million, the aim is to strengthen public-interest functions through “dispersed ownership.” As all five major domestic exchanges fall within the scope, the policy is also expected to become a key variable for big-ticket deals involving Naver and Mirae Asset, which are respectively pursuing Dunamu and Korbit acquisitions.

Controlling shareholders’ stake capped at up to 20%

According to the industry on the 31st, a proposal under serious consideration for the Financial Services Commission’s planned Digital Asset Framework Act would cap a virtual-asset exchange controlling shareholder’s stake at 15–20%. The idea is to redefine virtual-asset exchanges as public infrastructure on par with alternative trading systems (ATS). Under the current Capital Markets Act, an ATS cannot own more than 15% of voting shares, including shares held by related parties. Only when financial companies, public offering funds and the like obtain FSC approval may they exceptionally hold more than 15%. Nextrade is owned on a split basis, with seven securities firms—including Korea Investment and Mirae Asset—each holding 6.64%.

The push to overhaul virtual-asset exchange governance is seen as an attempt to fix the current structure in which a small number of founders or shareholders wield outsized influence over overall operations. It is also intended to break the market dominance of the top two players, including Upbit and Bithumb, and to build an ecosystem where diverse operators can enter and compete fairly.

A core pillar is a proposal to shift the current notification system to a licensing regime. Until now, oversight has relied on indirect management and control through banks that provide real-name accounts, without direct licensing by financial authorities or governance reviews. Once the law is enacted, exchanges would likely need a business license from financial authorities to operate. In that process, fit-and-proper reviews of controlling shareholders and ownership-dispersion requirements are expected to serve as key yardsticks.

The “separation of finance and industry” principle, which has limited the combination of traditional finance and virtual-asset businesses, is also likely to be eased. That is because ensuring market stability and effective supervision during ownership dispersion would be difficult without participation from regulated financial institutions. If combined with industry-promotion measures expected to be included in the bill, the largely retail-driven domestic digital-asset market could also be upgraded into areas such as institutional investment, real-world asset tokenization (RWA), and security tokens (STO). A financial industry official said, “The exchange business has an adult-sized scale, but its governance and user-protection systems are still at a child’s level,” adding, “This is the moment for fundamental change.”

Stake reductions likely unavoidable

To continue operating after the law takes effect, the largest shareholders of Korea’s five KRW-based virtual-asset exchanges would have to sell down their stakes. At Dunamu, which runs Upbit, Chairman Song Chi-hyung is the largest shareholder with a 25.52% stake. At Bithumb, Bithumb Holdings owns 73.56%. At Coinone, CEO Cha Myung-hoon, the founder, holds 53.44% including shares held via a personal company, while at Korbit, NXC holds 60.5%. In the case of Gopax, the overseas exchange Binance holds 67.45%. Many exchanges also have multiple major shareholders other than the largest shareholder holding 20% or more. Their stake reductions appear inevitable.

This is why observers say Naver’s and Mirae Asset’s plans to bring Dunamu and Korbit into their respective folds could face setbacks. Naver said it would make Dunamu a second-tier subsidiary through a share swap between its subsidiary Naver Pay and Dunamu. Because the structure would have Naver Pay owning 100% of Dunamu, it would run afoul of the controlling-shareholder stake cap. Accordingly, the equity structure will likely need to be redesigned.

The same applies to Mirae Asset, which is planning to acquire Korbit. Mirae Asset signed a memorandum of understanding (MOU) to buy stakes held by Korbit’s largest shareholder NXC and second-largest shareholder SK Planet (31.5%). However, if the relevant regulations materialize, significant constraints are expected on Mirae Asset’s ability to acquire control of Korbit. A financial industry official said, “A sufficient grace period can be granted during the shift to a licensing regime,” adding, “Stake adjustments are also likely to proceed in phases accordingly.”

Reporter Cho Mi-hyun / Seo Hyung-kyo mwise@hankyung.com