The Financial Services Commission of South Korea has announced a probe into the well-known crypto exchange Upbit’s market dominance. Upbit, the platform that has turned into the world’s 2nd-biggest crypto exchange, witnessed its supremacy surge following the establishment of a business collaboration with K-Bank triggering the country’s regulator to start an investigation. K-Bank is the earliest internet-only bank in South Korea.
South Korea’s FSC Looks into the Increasing Market Dominance of Upbit
This investigation takes place at a time when K-Bank is readying for an initial public offering (IPO). This has raised several concerns about the important role of crypto-related deposits in the balance sheet of the bank. Kim Byung-hwan, the chairman of FSC, disclosed plans for the respective probe. This occurred in a session of the State Affairs Committee of the National Assembly on October 10.
Trending Now: Bitcoin to Reach $135,000 By September 2025: Expert
While responding to a query from the Democratic Party of Korea’s lawyer Lee Kang-il, Kim acknowledged the apprehensions about Upbit. He admitted the monopoly of the crypto exchange in the overall virtual-asset industry. Kim stated that he knows about this issue, adding that the regulatory agency will do something in this respect. As per him, the FSC will deeply look into the problem via a thorough review under its Virtual Asset Committee.
The market position of Upbit became the chief focus of discussion and lawmaker Lee pointed toward the dominance thereof. As per the lawmaker, this started following Upbit formed a strategic collaboration with K-Bank. This partnership has been playing a vital role for the two entities. However, it has additionally raised concerns about the increasing market concentration. K-Bank intends to soon go public while the relationship between it and Upbit has obtained significant attention to likely risks. Upbit customers account for approximately twenty percent of the cumulative deposits of K-Bank, equaling 4T won from a total of 22T won.
Financial Regulator Assures Proper Scrutiny and Review of K-Bank, Upbit
Lee expressed apprehensions over the potential hazards of the respective dependency, particularly while the IPO of K-Bank is approaching. He cautioned about a likely “bank run” in the case of the sudden withdrawal of Upbit-related deposits. If the transactions witness an abrupt cut-off, a liquidity crisis could take place for K-Bank, according to Lee. While answering this, Kim reassured the community about the proper scrutiny of the listing process of K-Bank. Moreover, he additionally promised a wider review of the collaboration between K-Bank and Upbit.