The government is expected to ease the "separation of finance and crypto" (ban on financial companies investing in virtual asset business operators) regulation that has been in place for nine years. Issuing a won stablecoin ahead of institutionalization requires equity investment by financial companies, but the separation rule is blocking that. This is also expected to give a green light to the merger and acquisition process of the virtual asset exchanges of NAVER and Mirae Asset.
According to the financial authorities on the 12th, the Financial Services Commission is expected to include a greatly relaxed separation clause in the "Basic Act on Digital Assets (Phase 2 virtual asset bill)," which it will announce soon.
The separation clause first appeared in December 2017 under the Moon Jae-in administration as part of an "emergency plan on virtual currency." It bans financial companies from becoming shareholders of virtual asset business operators, saying that financial companies investing in virtual assets could fuel speculative sentiment. Financial companies are also barred from holding virtual assets or engaging in transactions using them as collateral. The regulation remains in effect to this day.
However, as the government pushes to institutionalize stablecoins, the separation rule has become an obstacle. An official at the financial authorities said, "Stablecoins are also virtual assets, and issuing them requires equity investment by financial companies," adding, "Easing the separation was something that had to be considered at some point."
Currently, Naver Financial is proceeding with a merger process with Dunamu, the operator of the virtual asset exchange Upbit, and Mirae Asset Group is in the early stages of acquiring Korbit, the fourth-largest exchange in Korea. Mirae Asset Group plans to have Mirae Asset Consulting, a non-financial affiliate, acquire Korbit. Because Mirae Asset Consulting holds 36.92% equity in Mirae Asset Global Investments, there had been projections that the acquisition would not be easy if the separation rule were applied.
An official at the financial authorities said, "We are not currently making a separate judgment on whether the separation rule applies to Naver and Mirae Asset," adding, "As the separation is likely to be eased in the process of drafting the Phase 2 bill, we plan to keep pace while watching the bill's introduction and standing committee review."