[National Audit 2025] Allegations of 'Insider Information' in Naver-Dunamu Big Deal... Platform Coin Issuance Faces Investigation

2025-10-20 16:33
Blockmedia
Blockmedia
[National Audit 2025] Allegations of 'Insider Information' in Naver-Dunamu Big Deal... Platform Coin Issuance Faces Investigation

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Concerns over Naver-Dunamu Merger Rumors and Stablecoin Issuance Emerge in South Korea's Financial Discourse

South Korea’s financial landscape is grappling with pressing concerns highlighted by lawmakers regarding stock market volatility, regulatory gaps, and the implications of stablecoin issuance by non-financial platform giants like Naver and Kakao. The ongoing discussions reflect the nation’s resolve to address the convergence of fintech innovation and financial stability.

Stock Market Volatility Over Naver-Dunamu Merger Rumors

A series of unverified merger rumors between Naver, South Korea’s tech giant, and Dunamu, the operator of cryptocurrency exchange Upbit, have sent shockwaves through the stock markets. Min Byung-deok, Democratic Party lawmaker, raised alarm during a parliamentary audit by the National Policy Committee, citing potential market manipulation and regulatory loopholes.

Min critiqued the significant market fluctuations driven by speculation after reports hinted at the merger. Despite Naver’s concise filing, which stated, “nothing has been specifically decided,” the stock prices of both companies surged dramatically. Min pointed out that trading volumes spiked before official articles were released, with activity notably increasing around 10:40 a.m., long before public dissemination at 3 p.m.

“This indicates the possibility of market manipulation through the use of undisclosed information,” stated Min, emphasizing the detrimental impact of unverified rumors on market integrity. He urged financial regulators to investigate these events thoroughly, contending that major market movements caused by unofficial reports are both inappropriate and indicative of systemic vulnerabilities.

Lee Eok-won, Chairman of the Financial Services Commission (FSC), conceded the gravity of the issue, remarking, “Such actions are indeed problematic, and we intend to scrutinize the circumstances surrounding these leaks and assess their broader market impact.”

Stablecoin Issuance Challenges Financial Stability

The parliamentary audit further shifted focus to the risks posed by the issuance of stablecoins, especially Korean won-backed stablecoins, by non-financial platform companies like Naver and Kakao. The intersection of crypto exchanges and platform businesses within self-contained ecosystems was flagged as a potentially hazardous trend.

Yoo Young-ha of the ruling People Power Party highlighted the risks of financial instability and market imbalance due to these practices. He argued that the issuance of proprietary stablecoins by crypto exchanges, coupled with their listing on affiliated platforms, creates severe conflicts of interest. Naver and Kakao, leveraging their expansive tech-driven ecosystems, could foster broad consumer dependence, raising concerns about monopolistic dynamics within the digital payments industry.

Yoo proposed stringent measures to mitigate these risks:

  • Mandating banks to spearhead stablecoin consortia,
  • Restricting fintech companies to purely technology-based roles without stablecoin issuance authority,
  • Prohibiting cryptocurrency exchanges from issuing in-house stablecoins,
  • Banning interest payments on stablecoin holdings, and
  • Creating controlled regulatory sandboxes to test fintech solutions.

Yoo further warned against the excessive issuance of stablecoins backed by the Korean won. He noted that due to their limited international utility and South Korea’s advanced domestic payment systems, overissuance could lead to economic isolation of the digital currency. He advocated for a regulatory system tailored to actual market demands rather than speculative growth.

Regulatory Roadmap for Stablecoin Issuance

FSC Chairman Lee Eok-won outlined the underlying principles guiding regulatory measures in response to the challenges presented by stablecoin issuance. “We are crafting regulatory guidelines based on three critical pillars: ensuring alignment with global standards, fostering an environment conducive to innovation, and protecting market stability,” Lee stated.

In alignment with these goals, the FSC has determined that interest payments on stablecoin holdings will be categorically prohibited. This stands as an essential step toward deterring speculative behavior and safeguarding consumer assets. By adhering to international best practices, the regulatory framework seeks to balance the benefits of technological advancements with economic safeguarding measures.

Balancing Innovation and Stability

The ongoing discourse in South Korea highlights the dual necessity of fostering fintech innovation while ensuring comprehensive regulatory oversight to protect financial markets. As blockchain-driven technologies and digital currencies proliferate globally, South Korea’s proactive stance serves as an important precedent in addressing emerging challenges like market manipulation and stablecoin governance.

By implementing stricter regulations, lawmakers aim to construct a robust and sustainable fintech ecosystem capable of balancing growth with market integrity. As the nation moves forward, stakeholders will need to collaborate to ensure that technological progress does not compromise financial stability or consumer trust in this increasingly digitized economy.

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