South Korea weighs crypto market makers after JPYC trades at 4 times peg
South Korea’s Financial Services Commission is considering allowing market-making for digital assets after JPYC, a yen-backed stablecoin, briefly surged to more than four times its peg on Upbit because of thin liquidity. FSC director Yoo Young-joon said regulators will review mechanisms such as market making to improve efficiency and stability, especially after criticism that users lost money from the price spike. Current law does not exempt market makers from market-manipulation rules, which has limited liquidity provision in crypto markets. The idea has been debated before: some researchers warn it could enable manipulation, while others argue a formal market-maker framework is needed to reduce volatility, price gaps, and inefficiencies like the Kimchi premium. The discussion is part of South Korea’s broader effort to build a unified crypto regulatory framework, including a planned Digital Asset Basic Act covering stablecoins, exchanges, disclosures, and internal controls.
