South Korea’s financial regulator has ordered a stop to all crypto lending on local exchanges, saying the fast-growing products lack proper rules and pose risks.

The Financial Services Commission (FSC) issued administrative guidance that takes effect immediately and will stay in place until new lending rules are written.

Regulator Moves To Halt Crypto Lending

According to the FSC, exchanges must suspend services that let users borrow against crypto or fiat deposits. Existing loans are not being wiped out; borrowers can still repay or extend under current contracts.

Reports say the order is an administrative step, not a criminal ban, but platforms that ignore it may face on-site inspections from authorities.

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