South Korea Adds Bithumb to Conglomerate List, Marking Stricter Crypto Oversight as Trading Skyrockets

Bithumb Joins South Korea's Watchlist Of Conglomerates Amid Surge In Crypto Trading

The South Korean Fair Trade Commission (FTC) has recently added four new business groups to its growing list of conglomerates requiring closer scrutiny.

Among them is the cryptocurrency exchange Bithumb, which now faces stricter public disclosure and regulatory oversight following its rapid growth in 2024.

The inclusion of Bithumb, alongside other major players such as defence contractor LIG, highlights the increasing importance of crypto and military sectors within the nation's economic landscape.

What Does Bithumb's New Status As A Conglomerate Mean?

Bithumb, once operating outside the radar of the country's corporate watch, is now classified as a conglomerate, a category which subjects it to a host of financial regulations.

The FTC's decision to include Bithumb follows a sharp rise in virtual asset trading and customer deposits, partly fuelled by speculation surrounding the return of U.S. President Donald Trump to office.

This surge in activity pushed Bithumb's rank to 90th place among the nation's largest companies.

Being designated as a conglomerate comes with significant requirements.

Bithumb must now adhere to financial disclosure rules, including regular reporting of stock holdings and asset ownership, as well as adhering to stricter investment and cross-holding regulations.

These rules aim to curb excessive control by large corporations over smaller firms and prevent circular investments, a common tactic among powerful conglomerates.

LIG, Upbit And Other New Additions To The Watchlist

The FTC's decision to expand its list of conglomerates also includes LIG, a defence-related business, driven by the escalating geopolitical tensions and increasing military expenditure.

The other three new entrants are real estate firm Daekwang, food manufacturer Sajo, and shipping company EUKOR, each of which saw significant growth in 2024, prompting the regulator’s intervention.

Notably, Upbit's operator Dunamu, which was previously classified as a "large conglomerate" in 2022, has been moved to the lower category of conglomerates this year.

Despite this shift, Dunamu remains among the most prominent players in South Korea's digital asset space.

South Korea's Scrutiny Of Its Largest Corporations Continues

The inclusion of Bithumb and other businesses reflects South Korea's ongoing efforts to regulate its powerful chaebol groups—large, often family-run conglomerates that have long been a dominant force in the nation’s economy.

This regulatory action follows the provisions of the Fair Trade Act, which aims to ensure a fair playing field by preventing companies from exerting undue influence over smaller competitors.

According to the FTC, these companies must provide regular reports on inter-affiliate transactions and their ownership structures.

They are also restricted from making significant equity investments in, or offering loan guarantees to, their affiliates.

This measure is designed to prevent the circular ownership structures that have previously allowed large corporations to manipulate their financial activities.

Shifts In Corporate Rankings: Lotte, Posco, And Others

While Bithumb’s rise to prominence has caused ripples in the rankings, other corporate movements have been noted.

Lotte Group, for example, reclaimed its spot as the 5th largest conglomerate, buoyed by a revaluation of its land assets.

In contrast, Posco slipped from 5th to 6th place, reflecting the downturn in the steel industry.

Similarly, NongHyup, a major agricultural group, saw a rise in the rankings, propelled by increased earnings from interest margins.

Despite these shifts, the FTC reported no changes in the controlling shareholders of major groups, including Coupang and Dunamu.

For now, the corporations themselves are recognised as the controlling entities, rather than individual executives, such as Bom Kim at Coupang and Song Chi-hyung at Dunamu.

Regulatory Oversight Grows As Corporate Landscape Evolves

With more companies now under closer examination by the FTC, South Korea's regulatory environment continues to adapt to an evolving corporate landscape.

The increase in cryptocurrency trading, defence spending, and shipping industry performance has created new challenges for the Fair Trade Commission, which is seeking to ensure transparency and accountability as large firms continue to grow and dominate key sectors of the economy.