The post South Korea Bans Leveraged Crypto Lending, Caps Rates at 20% appeared on BitcoinEthereumNews.com. South Korea’s Financial Services Commission (FSC) set new rules for crypto lending. The FSC said on Friday that interest on crypto lending is now capped at 20% in South Korea, and leveraged lending is not allowed. Crypto lending is restricted to the top 20 tokens by market capitalization or those listed on at least three won-based exchanges. The new rules follow late July reports that South Korea’s financial regulators had plans to release guidelines on cryptocurrency lending services to tighten oversight and protect investors. The move also followed the introduction of leveraged lending services by local crypto exchanges. The FSC noted that the review of the rules was triggered by a request from financial services, given the lack of regulations for lending. Now, exchanges must also ensure that first-time borrowers have completed online training and suitability tests set by the local self-regulatory organization, the Digital Asset eXchange Alliance (DAXA). South Korea’s Financial Services Commission. Source: Wikimedia Related: South Korea readies stablecoin framework; bill set for October More transparency, fair practices In the event of forced liquidations, users must be notified in advance, and adding capital to a position to avoid liquidation must be permitted. Lastly, exchanges must use their own capital to provide lending services: “Indirect lending through third-party collaborations or outsourcing is banned to prevent regulatory evasion.“ “The new regulations reflect South Korea’s increasingly critical stance toward crypto. Lee Eok-won, the nominee for chairman of the FSC, recently made critical remarks about cryptocurrency, noting that “crypto has extreme price volatility, lacks monetary function” and has “no intrinsic value.” According to reports from late July, the level of scrutiny is expected to increase. At the time, South Korea’s central bank was reported to be launching a virtual asset committee to monitor the crypto market. Still, crypto is gaining popularity in… The post South Korea Bans Leveraged Crypto Lending, Caps Rates at 20% appeared on BitcoinEthereumNews.com. South Korea’s Financial Services Commission (FSC) set new rules for crypto lending. The FSC said on Friday that interest on crypto lending is now capped at 20% in South Korea, and leveraged lending is not allowed. Crypto lending is restricted to the top 20 tokens by market capitalization or those listed on at least three won-based exchanges. The new rules follow late July reports that South Korea’s financial regulators had plans to release guidelines on cryptocurrency lending services to tighten oversight and protect investors. The move also followed the introduction of leveraged lending services by local crypto exchanges. The FSC noted that the review of the rules was triggered by a request from financial services, given the lack of regulations for lending. Now, exchanges must also ensure that first-time borrowers have completed online training and suitability tests set by the local self-regulatory organization, the Digital Asset eXchange Alliance (DAXA). South Korea’s Financial Services Commission. Source: Wikimedia Related: South Korea readies stablecoin framework; bill set for October More transparency, fair practices In the event of forced liquidations, users must be notified in advance, and adding capital to a position to avoid liquidation must be permitted. Lastly, exchanges must use their own capital to provide lending services: “Indirect lending through third-party collaborations or outsourcing is banned to prevent regulatory evasion.“ “The new regulations reflect South Korea’s increasingly critical stance toward crypto. Lee Eok-won, the nominee for chairman of the FSC, recently made critical remarks about cryptocurrency, noting that “crypto has extreme price volatility, lacks monetary function” and has “no intrinsic value.” According to reports from late July, the level of scrutiny is expected to increase. At the time, South Korea’s central bank was reported to be launching a virtual asset committee to monitor the crypto market. Still, crypto is gaining popularity in…