South Korea Shatters Corporate Crypto Ban, Imposes 5% Investment Cap for Listed Companies
South Korea's financial regulators just tore up the rulebook. The long-standing prohibition on corporate cryptocurrency holdings is officially dead—replaced by a new, tightly controlled framework that lets listed firms dive into digital assets, but only up to their fingertips.
The New Rules of the Game
The headline number is 5%. That's the hard ceiling now placed on how much of a company's assets can be parked in crypto. It's a cautious, risk-managed opening—a far cry from the wild west but a monumental shift from a total ban. Regulators are clearly betting that controlled exposure beats driving activity completely underground.
Why This Move Matters Now
This isn't just a policy tweak; it's a strategic realignment. With institutional adoption accelerating globally, South Korea's previous stance was becoming an economic liability. The new cap serves a dual purpose: it unlocks a new asset class for corporate treasuries while installing guardrails before the horse bolts. Expect balance sheets to see a new line item, and auditors to get a crash course in wallet security.
The Ripple Effect for Markets
Get ready for a wave of structured, institutional-grade capital flowing into the crypto ecosystem. This isn't speculative retail money—it's corporate treasury allocation, which tends to be stickier and more strategic. It validates crypto as a legitimate reserve asset, at least in the eyes of a major G20 economy's financial authority. Other jurisdictions watching from the sidelines now have a regulatory blueprint to copy, or critique.
A cynical observer might note that 5% is just enough for companies to dabble and claim innovation, without actually having to bet the farm. It's corporate finance's version of dipping a toe in the water while keeping your suit perfectly dry. But make no mistake: the dam has cracked. The question is no longer if traditional finance embraces crypto, but how fast, and how deep.
Nine-Year Ban Ends – Corporate Crypto Investment Legalized
South Korea’s financial watchdog, FSC, restricted corporations and banks from trading crypto due to government regulations that were put in force in 2017. At the time, the ban was put in place to alleviate “overheated speculation” and address money laundering concerns.
However, in response to the upsurge in global participation in the market, the FSC has lifted the ban. Considering risks associated with large-scale crypto investments, authorities have set the annual deposit limit at 5%of equity capital.
Further, the government has decided to establish standards for orders exceeding a particular price range on crypto exchanges. These standards aim to mitigate market risks stemming from increased liquidity.
5% Investment Cap is “Excessive”: Market Participants Argue
Financial industry insiders have expressed concerns that the 5% investment cap for corporate crypto investors seems excessively conservative. They noted that the US, Japan, and the EU impose no limits on corporate crypto holdings.
“Investment limits, which do not exist overseas, could weaken the inflow of funds and prevent the emergence of specialized virtual currency investment companies,” one market watcher noted.
Besides, with a foundation for long-term investment in place, the launch of won-denominated stablecoins and bitcoin spot exchange-traded funds (ETFs) is expected to accelerate, industry insiders expressed.
Seoul has taken steps to become a world crypto hub and has spent much of 2025 embracing cryptocurrencies at an unparalleled pace. For instance, in September, the nation’s ruling party, Democratic Party (DP), launched a new crypto policy-making task force in a move to “foster growth” in crypto innovation.
