What if the best way to own a crypto exchange was to wait for your government to force the sale?
That’s the unspoken logic playing out in South Korea right now, where Korea Investment & Securities (KIS) is apparently sniffing around a potential stake in Coinone, one of the country’s biggest crypto exchanges. No deal’s been signed. No official numbers. Just regulatory chatter and media reports citing unnamed sources. Which, in the world of Korean fintech M&A, might as well be smoke signals.
But here’s the thing—this isn’t opportunism dressed up as strategy. It’s opportunism enabled by regulation.
The Ownership Cap That’s Shaking Everything
On March 4, South Korea’s government and ruling party agreed on a proposal that would cap major shareholders’ stakes in domestic crypto exchanges at 20%. That’s not a small number. That’s a structural reinvention.
Coinone’s current chairman, Cha Myung-hoon, controls roughly 53% of the exchange. Under the new cap—assuming it becomes law—he’d be forced to offload roughly a third of his stake. Three years to do it. And unlike most regulatory pressure in crypto (which is often vague and toothless), this one has teeth. Real, enforceable, legal teeth.
“Under the proposal, exchanges would have three years from the law’s enforcement to adjust their ownership structures if the measure is passed.”
So Cha’s got a clock running. KIS knows it. The FSC (Financial Services Commission) knows it. And suddenly, what looks like a “potential investment” starts looking like a forced asset sale wearing a business casual outfit.
Why KIS? Why Now?
KIS made 2 trillion won in net profit last year (roughly $1.3 billion). It’s not some scrappy startup with a hunch about crypto. It’s a heavyweight with capital, regulatory access, and zero reason to move unless the math works.
The timing is obviously connected to the ownership cap proposal. But here’s the twist—KIS isn’t the only major player circling. Mirae Asset Group, KIS’s closest rival, already agreed to acquire a controlling stake in Korbit, another major exchange. That deal happened in February.
So you’ve got two competing mega-brokerages both making moves into crypto. One’s already secured a position. The other’s negotiating. And the government’s essentially holding a gun to the sector’s head and saying “someone’s gotta buy these stakes or you all need to restructure.”
This isn’t a bull market moment. This is forced consolidation dressed up as market activity.
The Regulation Game Nobody Wants to Admit They’re Playing
Here’s what’s fascinating and slightly infuriating about this whole scenario: it’s textbook regulatory-induced M&A, but everyone involved has to pretend it’s not.
KIS has to say “we’re exploring strategic opportunities.” Cha has to say “no deal’s been decided.” The FSC has to say “we’re just setting policy.” Nobody can say: “The government is basically forcing you to sell, and we’ve made it clear that this brokerage has the capital to buy.”
Because that would be naked government direction of private capital. And while South Korea’s never been shy about industrial policy, framing it as a “cap on foreign influence” or “investor protection” plays better in the headlines.
The other element nobody’s discussing: Cha could theoretically keep management control even if he sells down his stake. So this isn’t even about losing power. It’s about compliance theater. Sell the shares, keep the keys, everybody wins.
What About Naver’s Billion-Dollar Mess?
And then there’s Naver Financial, which tried to acquire Dunamu (the operator of Upbit) for $10.3 billion in an all-stock deal. That was supposed to be the big whale play. The heavyweight buying the heavyweight.
Except it’s stalled. Hard. Regulatory reviews dragged on. Trading volumes declined. The deal got pushed back on March 30 with no clear timeline. Which tells you something crucial: even when a mega-company tries to move directly into crypto ownership, the wheels fall off.
So KIS’s quieter approach—regulatory alignment, smaller stake, phased implementation—might actually be smarter. Less hostile. Less regulatory friction. Just a strategic stake in a forced sale.
It’s the difference between a handshake and a contract.
The Deeper Pattern: Consolidation by Policy
What’s happening in South Korea is worth watching because it could spread. When governments decide that crypto exchange ownership matters—whether for stability, for transparency, or just for the sake of control—they start writing ownership caps.
And the moment that happens, the game flips from “who can build the best exchange” to “who can absorb the forced sales.” Big brokerages with capital and regulatory access win. Founders who built something lose optionality. Users probably get better institutional backing. The market gets less competitive.
Is that a bad thing? Debatable. Is it what anyone would’ve predicted if you’d asked the crypto community five years ago? Not remotely.
But it’s how institutional adoption actually happens. Not through hype. Not through innovation. Through regulation that makes the sector boring enough and structured enough that old money decides it’s safe.
KIS’s stake in Coinone—if it happens—won’t be a crypto story. It’ll be a consolidation story. A South Korean brokerage buying into a forced sale because the government decided the exchange’s ownership structure didn’t fit the new rules.
Which is probably exactly how it should play out. But let’s not pretend it’s anything other than what it is.
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Frequently Asked Questions
What is Korea Investment & Securities doing with Coinone? KIS is reviewing a potential stake purchase in Coinone, likely as part of South Korea’s proposed ownership cap rules that would force major shareholders to reduce stakes from over 50% to a maximum of 20%.
Will South Korea’s 20% ownership cap become law? The government and ruling party agreed on the proposal in March, but it still needs to pass legislative approval. If passed, exchanges would have three years to comply with the new ownership structure.
How does this compare to other crypto deals in South Korea? Mirae Asset Group already secured a controlling stake in Korbit under similar pressures. Naver Financial’s larger $10.3 billion acquisition of Dunamu is currently stalled due to regulatory delays and declining trading volumes.
Can Coinone’s chairman keep control if he sells his stake? Yes. The proposal only caps ownership percentage, not management control, so Cha Myung-hoon could theoretically sell down his stake and retain operational leadership.
