South Korea's financial regulators have issued guidelines for virtual asset lending services, prohibiting excessive leverage lending.

South Korea's financial regulators have issued their first guidelines for virtual asset lending services. Due to increased competition among exchanges and heightened investor risks, regulators have completely banned leveraged and cash lending, and set individual limits and fee caps to discourage practices similar to short selling. On the 5th, the Financial Services Commission (FSC) announced it would implement the self-regulatory "Virtual Asset Lending Guidelines," developed by the Financial Supervisory Service and DAXA. The new guidelines focus on three key areas: service scope restrictions, user protection, and market stability. They explicitly prohibit excessive leveraged lending and Korean won cash lending, require exchanges to use their own assets to provide services, and prohibit third-party entrustment or indirect lending models.