Seoul, South Korea – February 2025: South Korea’s Fair Trade Commission (FTC) has launched a significant on-site investigation into Dunamu Inc., the prominent operator behind the Upbit cryptocurrency exchange. The probe, confirmed in early February, centers on serious allegations of unfair trade practices related to the exclusive trading of Dunamu’s own unlisted shares. This move by the national antitrust regulator sends a powerful signal about the evolving scrutiny of major crypto platforms, extending beyond financial compliance into the realm of competitive market conduct.
FTC Investigates Upbit Operator Dunamu: The Core Allegations
The investigation stems from a formal complaint filed with the FTC. The core allegation, as reported by financial media outlet Chosun Biz, is that Dunamu restricted the trading of its own unlisted company shares exclusively to its proprietary platform, ‘Dunamu Share Service’. This action allegedly prevented these shares from being traded on competing unlisted stock trading platforms. The FTC is now examining whether this constitutes an unfair refusal to deal, a potential violation of South Korea’s Monopoly Regulation and Fair Trade Act. The commission’s team conducted a physical, on-site investigation at Dunamu’s offices to gather documents and electronic data pertinent to the case. This type of direct action indicates the FTC considers the complaint to have substantial merit, warranting a deep dive into the company’s internal operations and decision-making processes.
Understanding the Unlisted Shares Market in South Korea
To grasp the full implications of this case, one must understand the context of South Korea’s unlisted shares market. Unlike publicly traded stocks on exchanges like the KOSPI, unlisted shares are not subject to the same level of disclosure and regulatory oversight. Trading typically occurs on specialized over-the-counter (OTC) platforms. For a high-profile company like Dunamu, which has been subject to frequent IPO speculation, its unlisted shares are considered valuable assets. By allegedly confining trading to its own platform, Dunamu could exert greater control over price discovery, liquidity, and access. This control raises critical questions about market fairness. Did this practice disadvantage investors seeking to buy or sell on other platforms? Did it artificially influence the perceived valuation of Dunamu? The FTC’s investigation will seek to determine if Dunamu’s actions stifled competition among trading platforms and harmed consumer choice.
The Regulatory Landscape for Crypto Exchanges in South Korea
This investigation does not occur in a vacuum. South Korean cryptocurrency exchanges, including Upbit, already operate under a stringent regulatory framework established by the Financial Services Commission (FSC) and the Financial Intelligence Unit (FIU). They face strict rules on real-name banking partnerships, anti-money laundering (AML) controls, and information security management (ISMS) certification. The FTC’s entry into the arena with an antitrust probe represents a new dimension of oversight. It highlights how crypto-native companies, once viewed as purely tech or finance firms, are now being held to the same comprehensive corporate governance and market conduct standards as traditional conglomerates, or *chaebols*. This case could set a precedent for how antitrust laws are applied to the digital asset sector’s ancillary business activities.
Potential Consequences and Broader Implications
The potential outcomes of the FTC investigation are serious. If the FTC concludes that Dunamu violated fair trade laws, the consequences could include:
- Corrective Orders: The FTC could mandate Dunamu to open the trading of its shares to other qualified platforms.
- Financial Penalties: The company could face a significant administrative fine, calculated as a percentage of the relevant revenue.
- Reputational Damage: For a company like Dunamu, trust is a key asset. A confirmed violation could erode user and investor confidence, potentially impacting Upbit’s market share.
Beyond Dunamu, this probe signals to the entire fintech and crypto industry that regulators are watching for anti-competitive behavior in all forms. It underscores that as crypto businesses diversify and create integrated ecosystems—encompassing exchanges, asset management, and now even share trading services—they must carefully navigate antitrust regulations designed to ensure a level playing field.
Historical Context and Timeline of Events
Dunamu, founded in 2012, launched Upbit in 2017, which rapidly grew to become South Korea’s largest crypto exchange by trading volume. The company has expanded into blockchain technology, wallet services, and investment products. The ‘Dunamu Share Service’ was launched as a platform for employees and early investors to trade unlisted shares. The recent FTC action follows a pattern of increasing regulatory attention on tech giants’ potential to leverage their market position. While not directly analogous, past FTC actions against companies like Naver and Kakao for alleged unfair practices in related markets provide a framework for understanding the regulatory mindset. The timeline is concise: a complaint was filed, the FTC found grounds for investigation, and it executed an on-site probe in early 2025 to collect evidence.
Conclusion
The FTC’s decision to investigate Upbit operator Dunamu marks a pivotal moment in the maturation of South Korea’s digital asset industry. It moves the regulatory conversation beyond pure financial security and into the complex arena of market structure and competitive fairness. The outcome of this probe will not only determine Dunamu’s compliance with antitrust law but will also establish clearer boundaries for how crypto-financial hybrids operate within the broader economy. For market participants, it is a stark reminder that innovation must be paired with rigorous adherence to established principles of market competition. The world is watching as South Korea’s FTC investigates Upbit’s parent company, setting a potential global benchmark for antitrust enforcement in the cryptosphere.
FAQs
Q1: What is the FTC investigating Dunamu for?
The South Korean Fair Trade Commission is investigating allegations that Dunamu unfairly restricted trading of its own unlisted shares to its proprietary platform, refusing to allow them on competing unlisted share trading platforms, which may violate fair trade laws.
Q2: How does this affect Upbit users?
Directly, the investigation targets Dunamu’s share trading service, not the Upbit crypto exchange’s day-to-day operations. However, a negative outcome could impact Dunamu’s resources and reputation, potentially causing indirect effects. User funds and crypto trading on Upbit remain under the separate oversight of financial authorities.
Q3: What are “unlisted shares”?
Unlisted shares are equity in a company that is not listed on a public stock exchange. They are typically traded privately or on specialized over-the-counter platforms, with less regulation and transparency than public stocks.
Q4: What could happen if Dunamu is found guilty?
Potential consequences include corrective orders to open its share trading to competitors, substantial financial penalties, and significant reputational damage that could affect its various business arms, including Upbit.
Q5: Why is this investigation significant for the crypto industry?
It signifies that regulators are applying traditional corporate antitrust standards to crypto businesses, expanding scrutiny from just financial compliance to overall market conduct. It sets a precedent for how large, diversified blockchain companies must operate fairly within their ecosystems.
