Bithumb to Scale Back Crypto Lending Services After Regulatory Pressure
Main Idea
Bithumb has significantly reduced its crypto lending services due to regulatory pressure, including lowering leverage ratios and lending caps, while rival Upbit excludes USDT from its lending offerings.
Key Points
1. Bithumb reduced its leverage ratio from x4 to x2 and slashed its maximum lending cap by 80% from 1 billion won to 200 million won.
2. The exchange temporarily suspended crypto lending on July 29 due to 'insufficient lending volume' but resumed the service on August 8 with new restrictions.
3. Bithumb stated the adjustments were made to 'protect investors and improve service quality,' applying the new terms even to 'qualified investors.'
4. South Korean regulators (FSC and FSS) are set to release guidelines for crypto exchanges, expressing concerns about leverage-associated risks and user understanding.
5. Upbit announced it will exclude Tether (USDT) from its new crypto lending services, with industry sources predicting further regulatory actions by the end of the month.
Description
The crypto exchange Bithumb has made “significant reductions” to the scale of its crypto lending services amid ongoing concerns from financial regulators. Per the South Korean newspaper Kookmin Ilbo , the trading platform has reduced its leverage ratio from x4 to x2. It has also slashed its maximum lending cap by 80% from 1 billion won ($718,298) to just 200 million won ($1,436). The move represents a major climbdown for Bithumb, which only launched the services in July. S. Korean retail investo...
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