South Korea Imposes Strict 20% Cap on Crypto Lending Rates

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South Korea’s Financial Services Commission (FSC) has banned leveraged crypto loans and capped lending interest rates at 20%.

The new guidelines, announced Friday, aim to protect users by prohibiting loans that exceed collateral value and banning cash-repayment products.

Services are now restricted to the top 20 cryptocurrencies, and lenders must use their own capital, not third parties, to offer these services. The rules also require platforms to set user lending limits and provide advance liquidation warnings.