The Evolving Landscape of Crypto Lending: Regulation vs. Unregulated Alternatives
South Korea just decided to pull the plug on new crypto lending, and it might have some serious implications globally. The FSC has essentially said, “No more new crypto loans”, effective August 19, 2025. The reason? To protect investors from the wild ride that is the crypto market. But here’s the kicker: could this stricter regulatory approach actually drive investors towards unregulated lending options? Let’s unpack this.
The Immediate Fallout: A Pause in Crypto Lending
With the suspension of new loans, the FSC aims to address the rising borrowing activity on platforms like Upbit and Bithumb, where users borrowed $1.2 billion in one month. The alarm bells rang when 13% of borrowers faced forced liquidations, pushing regulators to…
