South Korean Regulators Require Domestic CEX to Halt Lending Services Starting Today

BlockBeats News, August 19, according to The Block, the Financial Services Commission (FSC) of South Korea has ordered local cryptocurrency exchanges to suspend their lending services starting from August 19, 2025. The Financial Management Committee stated that the suspension measure will remain in place until official guidelines for cryptocurrency lending are established.

On July 4, 2025, Upbit introduced a service where users could borrow funds of up to 80% of their Korean won deposits or the value of their digital assets using Tether USDT, Bitcoin, and XRP. Bithumb also launched a service allowing users to borrow cryptocurrency worth up to four times the value of their held assets or Korean won collateral. Other exchanges followed suit.

On July 31, the Financial Supervisory Service requested all Centralized Exchanges (CEX) to reassess their lending services, stating that these services operate in a legal gray area and pose a high risk of user loss.