South Korea suggests a 5% cap on cryptocurrency holdings for publicly traded companies

South Korea Considers New Limits on Corporate Crypto Investments

South Korea’s Financial Services Commission (FSC) is reportedly weighing a new regulation that would restrict companies from investing more than 5% of their equity capital in cryptocurrencies. This move comes as the country looks to relax its long-standing limitations on institutional involvement in the digital asset market.

According to the FSC, draft guidelines for publicly traded companies and professional investors have been prepared, with the final version anticipated as soon as January or February. If approved, businesses could begin trading digital assets later in the year.

The draft policy would permit qualifying companies to invest up to 5% of their annual equity capital in digital currencies, but only among the 20 largest cryptocurrencies by market capitalization. Discussions are ongoing regarding whether stablecoins like USDT will be included in the eligible assets.

This initiative is part of a broader strategy to gradually lift the effective ban on institutional crypto trading. Since mid-2025, South Korea has started to ease these restrictions, initially allowing nonprofits and crypto exchanges to divest certain holdings. The FSC has previously indicated that listed corporations and professional investors would soon be permitted to participate in crypto markets.

The proposed 5% cap is intended to limit potential risks to company balance sheets and address concerns about increased volatility as more corporations enter the space.

Regulators are also expected to introduce additional safeguards, such as rules for staggered trading and price limits, to help manage market fluctuations as trading volumes grow.

Experts predict that most institutional investment will likely focus on bitcoin, with some interest in ether, even though the guidelines would allow exposure to the top 20 cryptocurrencies. Smaller tokens are expected to see minimal impact.

Industry observers are also closely monitoring the forthcoming Digital Asset Basic Act, slated for release in the first quarter, which could further define the regulatory landscape for stablecoins and spot cryptocurrency ETFs.