South Korea to Review Upbit’s Monopoly in Crypto Market

South Korea’s regulators are considering reviewing Korea’s largest crypto exchange, Upbit’s Monopoly in the virtual asset market.

On October 10, Kim Byung-hwan, chairman of the Financial Services Commission of South Korea, said that he would conduct a review of the dominance of Upbit in Korea’s crypto market through the Virtual Assets Committee.

According to a local media outlet, in a response to the questions from Rep. Lee Kang-il of the Democratic Party of Korea, Kim Byung-hwan said that a comprehensive review would be conducted through the Virtual Assets Committee. A rough translation of Kim Byung-hwan’s statement read, “I have a sense of the problem (about Upbit’s monopoly system).”

Rep. Lee pointed out in the question that the excessive “concentration” on one company and Upbit’s monopoly system began after the business partnership with K Bank.

Lee also raised the issue that Upbit’s deposits account for a significant part of the deposits of K Bank, which will soon launch an initial public offering (IPO).

Rep. Lee reportedly said that out of K Bank’s 22 trillion won in deposits, Upbit deposits amount to 4 trillion won which is nearly 20%, and if Upbit transactions are cut off, K Bank’s bank run might occur.

A rough translation of Lee’s claims read, “Is it common sense for K-Bank, which has an operating profit margin of less than 1%, to give 2.1% of Upbit’s customer deposits?” and added, “The influence between Upbit and K-Bank also violates the principle of separation of finance and industry.”

In response, Chairman Kim replied that the K-Bank listing review must have been sufficiently reviewed, and a virtual asset committee will take an overall look at it.

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