South Korean Regulators Review Market-Making Rules After Yen-Pegged Stablecoin Price Spike

A yen-pegged stablecoin called JPYC briefly traded for more than four times its intended value on South Korea's biggest crypto exchange, Upbit, in early September.

The price spike occurred within an hour of listing and was attributed to limited liquidity meeting strong buying demand. The token's price rocketed from 12 Korean won to 37.6 won, surpassing its reference rate by more than 10%, before settling back into the 8-won range the following day.

The fallout has prompted South Korea's Financial Services Commission (FSC) to review market-making rules, which currently restrict professional market makers from operating in the country's crypto market. The regulator is considering introducing a formal market-making system to improve digital-asset market efficiency and stability, according to FSC Director of Digital Finance Policy Yoo Young-joon.