South Korea’s FSC suspended new crypto lending on exchanges effective August 19, 2025, citing investor safety concerns. About 13 percent of 27,000 lending customers faced forced liquidations, exposing systemic risks in leveraged products. New crypto lending regulations are expected in early 2026, aiming to align with broader financial safeguards. South Korea’s Financial Services Commission (FSC) has suspended all new crypto lending activities on local exchanges, effective August 19, 2025. The directive requires major platforms such as Upbit, Bithumb, and Coinone to immediately cease issuing new loans. While existing loan contracts can continue under their current terms, the FSC stressed that the suspension is a temporary but necessary measure until comprehensive guidelines can be established. The decision marks the strongest intervention yet into South Korea’s crypto lending sector, which has grown sharply over the past two years. Concerns Over Leverage and Investor Safety Officials highlighted investor protection as the primary driver for the crackdown. The FSC reported that approximately 13 percent of the 27,000 customers using lending services … The post Upbit, Bithumb Forced to Halt Crypto Lending by South Korean Regulator appeared first on Coin Edition .
