Crypto Group DAXA Opposes Proposed Exchange Ownership Limits

Summary: South Korean exchange alliance warns ownership cap could hurt market growth.

A major industry group representing South Korea’s largest cryptocurrency exchanges has spoken out strongly against a recently proposed rule that would limit how much any one person or entity can own in a crypto trading platform.

The Digital Asset Exchange Alliance (DAXA) — which includes big names such as Upbit, Bithumb, Korbit, Coinone and GOPAX — says the government’s idea to cap major shareholder stakes at roughly 15–20% of an exchange’s equity could undermine the country’s digital asset industry, not strengthen it.

South Korea’s financial authorities are weighing this ownership cap as part of broader rules in the incoming Digital Asset Basic Act, aimed at tightening oversight of the crypto sector and protecting consumers. Under the proposal, founders and large investors holding more than the limit would be forced to reduce their stakes — a step regulators hope will spread control and reduce risk.

In response, DAXA issued a detailed statement saying the cap could have unintended, negative effects. The alliance argues that concentrating ownership with experienced founders and backers actually supports market stability, accountability and long-term investment — areas vital for platforms that handle billions in assets and daily trading volume.

DAXA also warned that forcing owners to divest could discourage investment, prompt capital flight to overseas exchanges, and weaken South Korea’s competitiveness in the fast-moving global crypto space. They pointed out that most major markets do not impose similar ownership restrictions, instead focusing on licensing, operational standards and risk control measures.

Industry analysts say the debate illustrates a wider tension in crypto regulation: how to balance consumer protection and systemic safeguards with policies that don’t choke innovation or drive business abroad. Proponents of the ownership limit argue that it lowers the chances of conflicts of interest and excessive control. In contrast, opponents like DAXA view it as an overstep that could harm users and the local environment.

The issue has drawn wider attention because it isn’t just about ownership percentages — it could also reshape planned mergers and deals in the South Korean market. Some founders and investors have flagged that current talks around exchange acquisitions and partnerships could be affected if new caps become law.

As discussions continue in government circles, both regulators and industry stakeholders are watching closely. The outcome could influence not just South Korea’s crypto landscape but also how other Asian markets approach similar questions of governance and oversight in digital asset trading.