South Korea Plans to End Nine-Year Corporate Crypto Ban With 5% Investment Cap

Companies could return to crypto markets in 2026

South Korea is preparing to end a prohibition on corporate cryptocurrency investment that has been in place since 2017, opening a route for listed companies and professional investors to enter a market long dominated by individual traders. Under guidelines being developed by the Financial Services Commission (FSC), eligible businesses would be allowed to invest up to 5% of their equity capital annually in selected digital assets.

As of January 13, 2026, the final rules are expected by February, with companies potentially beginning investments by the end of 2026. Access would be limited to the top 20 cryptocurrencies by market capitalization listed on South Korea's five major exchanges. Whether stablecoins tied to the US dollar, including USDT, will qualify remains under discussion.

The opening would reverse restrictions introduced nine years ago, when authorities described cryptocurrency investment as nonproductive speculation and banned Initial Coin Offerings (ICOs). An ICO is a way for a cryptocurrency project to raise money by selling tokens. The corporate investment restrictions kept major South Korean businesses outside the domestic market even as cryptocurrency trading became popular among individuals.

President Lee Jae-myung, who took office in 2025, has supported a more welcoming approach to cryptocurrencies. His administration's plans extend beyond corporate access to include stablecoin rules, investment products and the use of a central bank digital currency in national treasury transactions.

The FSC's proposed opening pairs new investment permissions with limits on exposure, trading controls and closer checks on institutional customers. Its aim is to let businesses participate without allowing large corporate purchases or suspicious transactions to destabilize the local financial market. The result would be a gradual return to cryptocurrency investment, with boundaries around both the assets companies can buy and the way they can trade.

What the 5% limit would allow

Listed corporations and entities registered as professional investors would be eligible to trade under the proposed framework. Their annual cryptocurrency allocation would be capped at 5% of equity capital. Equity capital is the value belonging to shareholders after a company's liabilities are deducted from its assets.

A percentage limit ties the permitted investment to the company's financial size. The proposed ceiling is intended to give businesses room to diversify their holdings while limiting their exposure to a market where prices can change sharply. It also seeks to prevent companies from taking on excessive financial risk as they enter cryptocurrency trading.

The eligible asset list would be restricted to the top 20 cryptocurrencies by market capitalization available on the five designated domestic exchanges. Market capitalization measures the total value of a cryptocurrency's circulating supply at its current price. The restriction is intended to direct corporate money toward larger assets with more established trading histories and greater liquidity, meaning they are generally easier to buy and sell.

Transactions would be confined to Upbit, Bithumb, Korbit, INEX and Coinone. Requiring companies to use these regulated domestic platforms would allow South Korean authorities to keep transactions within local oversight and compliance arrangements.

Trading controls and the stablecoin decision

The FSC's planned safeguards include split trading requirements and price limits. Splitting a large purchase or sale into smaller transactions is intended to reduce the pressure that a single corporate order can place on a market. Price limits would place additional boundaries around trading as institutional money enters.

Liquidity risk is a central concern. A company seeking to buy or sell a large quantity of cryptocurrency may find too few matching orders at the price it expects. The proposed controls seek to manage that risk and reduce sudden price movements.

USDT and other stablecoins tied to the dollar present a separate decision. Stablecoins are designed to track another asset, such as a national currency. Their inclusion would affect how businesses manage their cryptocurrency exposure and move money between domestic and global markets. The framework has yet to settle their eligibility.

How the restrictions began and the opening developed

South Korea introduced the restrictions in 2017 during a surge in global cryptocurrency activity. Authorities were concerned about money laundering, an overheated market and threats to financial stability. The resulting prohibition covered corporate cryptocurrency investment, while ICOs were also banned.

For nearly a decade, the policy kept major domestic corporations on the sidelines. Businesses seeking cryptocurrency exposure had to look toward foreign jurisdictions, while South Korea's local market developed around individual investors.

The government later began easing access in stages. Nonprofit organizations and registered cryptocurrency exchanges were allowed to sell holdings for financial management, providing an initial test before broader corporate participation. The main dates in the policy's development are:

• 2017: Authorities prohibited corporate cryptocurrency investment and banned ICOs amid concerns about speculation, money laundering and financial stability.
• 2025: Lee Jae-myung took office and backed a more welcoming approach to digital assets.
• June 2025: Certain nonprofit organizations and registered cryptocurrency exchanges were permitted to sell cryptocurrency holdings.
• Second half of 2025: The government's earlier timetable called for measures allowing listed companies and professional investor entities to trade, alongside additional measures against money laundering.
• February 2026: Final corporate investment guidelines are expected.
• By the end of 2026: Companies could begin investing under the new framework.

The earlier opening allowed institutions to liquidate assets, meaning sell them for money. The proposed corporate framework goes further by allowing eligible businesses to buy digital assets as investments. The government is using this sequence to expand participation while developing the controls needed for a larger institutional market.

A large retail market with limited corporate access

South Korea had 9.7 million cryptocurrency exchange users at the end of 2025, representing nearly 20% of its population. That is close to one person in five. The country has a large spot cryptocurrency market, where participants buy and sell the assets themselves.

Individual traders have been especially active in altcoins, the term used for cryptocurrencies other than Bitcoin. Their strong participation stands alongside the long absence of major domestic corporate investors, creating a market with a large retail audience but limited institutional involvement.

The restrictions contributed to market inefficiencies and encouraged businesses and funds to seek opportunities in jurisdictions with more welcoming rules. Nearly US$110 billion in cryptocurrency assets left South Korea in 2025 amid the limits on institutional participation.

By creating a regulated domestic investment route, the government hopes to bring funds back into the country and encourage investment in local digital asset businesses. The opening is also expected to support cryptocurrency companies, blockchain startups and the digital asset token (DAT) sector.

How much corporate money could enter?

Expectations for the opening include participation by more than 3,500 corporations and potential inflows of tens of trillions of won. Those estimates illustrate the scale of the proposed change in a market where individual traders have long played the leading role.

Naver provides an example of how the percentage limit could translate into a substantial investment. The internet company has capital of 27 trillion won, equivalent to $18.4 billion. A 5% allocation would amount to 1.35 trillion won, or approximately $920 million using those figures.

Within that limit, Naver could theoretically acquire about 10,000 Bitcoin. The example describes the room available under the proposed rules. It is a hypothetical allocation, with the amount a company ultimately invests depending on its own decisions.

Purchases by large conglomerates could add liquidity and give cryptocurrency a more established place in corporate finance. Institutional participation could also change the balance of the domestic market, reducing the dominance of retail traders and potentially making trading more stable.

The expected benefits extend to investment products and payment assets. Corporate access is seen as a step that could accelerate the launch of a national stablecoin and approval of spot Bitcoin exchange traded funds (ETFs), both of which have been stalled under the previous regulatory approach. A spot Bitcoin ETF would give investors exposure to Bitcoin through a fund that holds the asset.

Why the investment ceiling is drawing objections

Some industry participants welcome the end of the ban while arguing that the proposed 5% ceiling would be too restrictive. Their concern is that a limit designed to contain financial risk could also reduce incoming funds and constrain businesses specializing in cryptocurrency investment.

An unnamed industry insider involved in discussions about the guidelines described the concern about investment limits and the creation of specialist companies:

Investment limits, which do not exist overseas, could weaken the inflow of funds and prevent the emergence of specialized virtual currency investment companies,

Critics point to the United States, Japan and the European Union as jurisdictions without equivalent percentage caps on corporate cryptocurrency holdings. They argue that South Korean companies could face a competitive disadvantage if domestic investment rules leave them with less room to operate.

Hong Kong and Japan have also recently tightened oversight of corporate cryptocurrency exposure to reduce risks to the wider financial system. Those approaches show that broader corporate participation can coexist with closer supervision. South Korea's proposal combines permission to invest with a specific ceiling, an approved asset list and trading safeguards.

Banks and exchanges face stronger customer checks

South Korea is requiring cryptocurrency exchanges and their partner banks to strengthen know your customer (KYC) checks for new institutional clients. KYC procedures establish who a customer is and help financial businesses assess the risks attached to an account.

The FSC has stated that exchanges and banks must examine the source of institutional funds and the purpose of transactions in detail. Institutions and their chief executives must also be monitored for potential activities connected to money laundering, the process of disguising the origin of illegally obtained money.

The Korea Federation of Banks and the Digital Asset Exchange Association (DAXA) are expected to distribute the instructions to banks and exchanges. Their involvement is intended to create a shared compliance standard across the businesses handling institutional cryptocurrency transactions.

The requirements build on the checks accompanying the June 2025 permission for certain nonprofit organizations and registered exchanges to sell their holdings. As access expands, the government intends to keep the concern that helped drive the 2017 restrictions, money laundering, at the center of supervision.

Stablecoin licensing and treasury plans

The corporate investment framework sits within a wider digital asset strategy. Under the 2026 Economic Growth Strategy, the government plans to execute 25% of national treasury transactions through a central bank digital currency by 2030. That target would cover one quarter of those transactions.

A central bank digital currency is digital money issued by a central bank. The treasury plan would bring that form of money into government financial operations, alongside efforts to establish rules for privately issued digital assets.

The government also plans a licensing regime for stablecoin issuers. Under the proposal, issuers would need to maintain 100% reserve backing and provide legally guaranteed redemption rights. Full backing means holding reserves equal to the value of the stablecoins issued, while redemption rights would give users a legal claim to exchange their tokens for the corresponding value.

The stablecoin proposal, the treasury target and corporate investment access reflect an effort to bring cryptocurrencies, stablecoins and central bank digital money into a broader regulatory framework. Each addresses a different activity: companies investing, private issuers creating tokens tied to currency, and the government using digital money.

Legislation still has decisions to settle

The Digital Asset Basic Law, intended to establish comprehensive standards for stablecoin issuance, custody and investor protection, has been postponed to 2026. Custody refers to holding and safeguarding assets on someone else's behalf, an important responsibility when companies or financial services manage customers' cryptocurrency.

Regulators are debating whether the FSC or the Bank of Korea should oversee stablecoin reserves. They are also considering which institutions should be allowed to issue stablecoins tied to the won. Those decisions will help determine who can operate in the market and which authority checks the assets backing the tokens.

The corporate guidelines would provide a bridge while that wider legal framework is completed. Businesses could gain a controlled route into cryptocurrency investment, while lawmakers and regulators continue working on rules for issuance, asset storage and customer protection.

For companies considering participation, the next scheduled milestone is the expected completion of the guidelines in February 2026. The proposed 5% ceiling, approved cryptocurrency list, domestic exchange requirement and compliance checks define the planned opening, with investment potentially starting by the end of the year.

Key Points

• South Korea plans to end corporate cryptocurrency investment restrictions introduced in 2017.
• Final guidelines are expected by February 2026, with investment potentially beginning by the end of 2026.
• Eligible listed companies and professional investors would be allowed to invest up to 5% of equity capital annually.
• Purchases would be limited to the top 20 cryptocurrencies on five major domestic exchanges; stablecoin eligibility is still under discussion.
• More than 3,500 corporations are expected to participate, with potential inflows estimated at tens of trillions of won.
• South Korea had 9.7 million exchange users at the end of 2025, while nearly US$110 billion in cryptocurrency assets left the country during that year.
• Banks and exchanges face stronger checks on institutional customers, funding sources and transaction purposes.
• The broader agenda includes stablecoin licensing, the Digital Asset Basic Law in 2026 and a target to conduct 25% of treasury transactions through a central bank digital currency by 2030.