This article was published on May 11, 2025, at 6 p.m. on the ChosunBiz RM Report site.
The government has begun work to change the system of Upbit and Bithumb, which have practically dominated the virtual asset exchange market. It plans to review entry barriers, listing procedures, and the overall market structure beyond simple market share regulations and prepare institutional improvement measures. This is a response to growing concerns about deepening monopolies and reduced consumer choices in the rapidly expanding virtual asset market.
According to related ministries on the 12th, the Fair Trade Commission and the Financial Services Commission recently commissioned a study on 'analyzing the virtual asset trading market and the competitive impact assessment of major regulations' and have initiated structural improvement work. The plan is to compare and analyze domestic and international markets to examine the competitive basis of the virtual asset ecosystem and consider institutional reforms if necessary.
Currently, the domestic virtual asset exchange market is solidified in a 'Big 2' system. According to the virtual asset information provider CoinGecko, Upbit and Bithumb account for 78.7% and 19.5% of daily transaction volume, respectively, making the two account for 98.2% of the entire market. Based on transaction amount, it recorded 96.1%. This figure greatly exceeds the 'dominant market player' standard under the Fair Trade Act, which stipulates that three or fewer businesses must have a market share of over 75%.
However, there is no clear evidence that Upbit or Bithumb have engaged in abuse of market dominance. The Fair Trade Commission believes that market share alone cannot be a basis for sanctions. This study will comprehensively analyze factors such as ▲ the range of virtual asset products and services offered ▲ consumer behavior and transaction patterns ▲ whether there are competition-restricting regulations and systems ▲ factors that undermine consumer welfare.
The government plans to focus on reviewing the issues of entry barriers and listing procedure transparency. Currently, to enter the won market, it is necessary to secure a real-name verification deposit and withdrawal account from a commercial bank. The issuance of real-name accounts involves stringent review standards and opaque criteria, leading to continuous criticism that new exchanges are effectively blocked from entering the market. This has intensified the market concentration towards existing large exchanges.
Furthermore, the unclear standards for listing reviews and delistings are also identified as issues making it difficult for small and newly established virtual assets to access large exchanges. Some exchanges have faced criticism for operating their own review criteria confidentially or vaguely, hindering fair market competition. The government also plans to explore ways to enhance the transparency and fairness of listing and exchange operations.
The government's push for restructuring the virtual asset trading market is due to the fact that virtual assets are growing into a financial market with institutional investors and global funds flowing in, beyond mere speculative assets. As the market rapidly expands, concerns have grown that if the competitive foundation weakens, financial risks and investor harm could be amplified.
Until now, the virtual asset market has only been subject to investor protection-centered regulations, such as the Specific Financial Information Act and the Virtual Asset User Protection Act, with no significant management system established from the perspective of industrial structure or competitive order.
During the National Assembly's audit, the issue of Upbit's monopoly has been repeatedly raised. Kim Byung-hwan, Chairman of the Financial Services Commission, noted earlier this year in the National Assembly that he would discuss it with the Fair Trade Commission, and Han Ki-jeong, Chairman of the Fair Trade Commission, also stated that he would actively review it through research if necessary after market analysis.
However, the Fair Trade Commission holds the stance that 'this is not an investigation targeting specific operators.' A Fair Trade Commission official explained, 'The virtual asset market is still an emerging industry area where competition law regulations have not been fully applied and aims to accurately assess the market and identify structural issues or institutional factors that hinder competition.'
The Fair Trade Commission has included not only the virtual asset market but also corporate accounting audits and the defense industry as subjects of structural analysis simultaneously. In the accounting audit market, the 'Big 4' accounting firms, such as Samil, Anjin, Samjeong, and Hanwha, effectively monopolize audits for large corporations, while in the defense market, four leading companies, including Hanwha Aerospace, Korea Aerospace Industries (KAI), Hyundai Rotem, and LIG Nex1, also monopolize.
Every year, the Fair Trade Commission selects specific markets to examine structural monopolies. Last year, it looked into the baking and liquor markets. Previously, the Fair Trade Commission also initiated a separate investigation into the three sugar companies (CJ CheilJedang, Samyang Corporation, and TS Corporation) regarding allegations of price collusion and penalized the liquor wholesale association for price collusion. Given the precedent where areas studied have led to investigations, similar processes cannot be ruled out in the virtual asset market.
The Fair Trade Commission plans to identify institutional factors that restrict competition and elements that undermine consumer welfare in these markets to seek structural improvement alternatives. A Fair Trade Commission official stated, 'Both new industries and those with entrenched monopolistic structures are subjects of review' and 'We will prepare practical improvement measures starting from areas where structural reforms are possible.'