South Korean Institutional Investors Can Open Digital Asset Exchange Accounts in the Second Half of 2025

Institutional investors in South Korea can open accounts on digital asset exchanges starting in the second half of the year, the country's financial watchdog has ruled.

South Korea’s institutional investors will be permitted to open accounts on digital asset exchanges in the second half of the year, the country’s financial regulator has ruled.

The Financial Services Commission (FSC) has been considering new rules that will allow institutions to hold digital assets since 2024. A month ago, the watchdog said it would need more time to consider the implications of the decision.

However, in its most recent meeting, the FSC unveiled a new roadmap that will gradually permit corporates to hold digital assets in stages, ultimately ending a seven-year ban that was introduced in 2017. The regulator said the roadmap will be rolled out in a manner that ensures consumer protection and maintains market stability.

The roadmap will begin by permitting corporates to open real-name verified accounts in the first half of the year, through which they will only be able to sell their digital asset holdings for fiat.

Furthermore, virtual asset service providers (VASPs) will only be permitted to begin liquidating their tokens through this roadmap once they establish industry standards to avoid any conflict of interest with their customers.

In the second half of 2025, the FSC will expand the functionalities of the corporate accounts, allowing them to engage in other digital asset investment and financial activities.

The watchdog revealed that its decision was driven by the high demand for digital asset products from South Korea’s institutional investors. The East Asian nation boasts one of the world’s largest digital asset markets, largely fueled by the country’s renowned appetite for high-risk, high-return assets.

In fact, the FSC said that at launch, it had lined up 3,500 corporate entities that had expressed interest in digital assets under the new roadmap.

“…qualified professional investors are already eligible to invest in highly risky and highly volatile derivatives products, and these corporations have demonstrated significant demand for pursuing blockchain-related business and investment opportunities,” FSC noted.

Admitting corporates into the digital asset sector does come with risks, which the agency acknowledged. While it will step up its oversight to cater to the increased activity, the FSC also called on financial entities to implement strict checks on clients who engage in ‘crypto’ transactions. It also pledged to publish new guidelines to assist the banks in strengthening their verification processes.

As the FSC rolls out enabling regulations for the digital asset sector, South Korea’s largest exchange is facing billions of won in potential fines for violating Know Your Customer (KYC) regulations.

An investigation that began last November found that the exchange had over 700,000 violations, according to local outlet Yonhap News. Each violation could attract thousands of dollars in fines, which would amount to the biggest penalty for a VASP in Asia. The outlet also cited sources within the FSC who said the exchange could be suspended for up to six months.

Speaking to legislators on Monday, FSC Governor Kim Byoung-hwan said the agency was “proceeding with the case quickly” and would conclude it soon.

Upbit is Korea’s dominant exchange, controlling nearly three-quarters of the market, with Bithumb, Coinone, and Korbit as its only sizable rivals. As such, any action by the FSC will have a seismic effect in a country where digital asset trading has occasionally outpaced stocks.

Meanwhile, Bybit was recently cleared by French authorities after being on the regulator’s blacklist since mid-2022. The Autorité des Marchés Financiers (AMF) had called on investors to avoid trading on Bybit and indicated that it would block the exchange’s website (although it never did).

Now, Bybit is in the AMF’s good graces, as CEO Ben Zhou noted recently.

“After more than two years of working with the French regulator through multiple remediation efforts, Bybit is now officially removed from France AMF blacklist,” Zhou revealed.

He added that the exchange is now pursuing a MiCA license, which its rivals like Crypto.com, OKX and most recently Bitget, have obtained.

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