Korea Digital Asset Exchanges Association: The South Korean government's proposed cap on exchange ownership will hinder industry development.

The Korea Association of Digital Asset Exchanges (DAXA) has issued a statement strongly opposing the government's proposed shareholding restrictions. The Financial Services Commission (FSC) had previously recommended limiting major shareholders' stakes in cryptocurrency exchanges to between 15% and 20% to address governance risks arising from concentrated ownership. DAXA argues that such restrictions would severely hinder the development of the country's digital asset industry, and that artificially altering the ownership structure of private companies would undermine the foundation of this emerging industry. DAXA further points out that due to the unrestricted global circulation of digital assets, unsustainable investment in domestic exchanges would lead to a loss of international competitiveness and encourage holders to migrate to overseas platforms. Furthermore, artificially dispersing ownership would weaken major shareholders' ultimate responsibility for the custody and management of user assets, harming user protection. This proposed restriction is part of the deliberations on the Basic Law on Digital Assets, with the relevant legislation expected to be completed in the first quarter of this year.