Author: Chloe, ChainCatcher
The KOSPI index has surged nearly 95% year-to-date, almost doubling. Just as the South Korean stock market is riding high, another group of Korean listed companies is gradually being squeezed out of the market.
According to The Chosun Ilbo, the revised listing regulations raising the threshold for maintaining a stock market presence in South Korea took effect on July 1. Some KOSDAQ-listed DAT companies that profited by investing in crypto assets now face delisting risks. They are caught between plummeting coin prices on one side and capital flight from the KOSDAQ market on the other. Their market capitalization continues to fall below new thresholds, putting them at imminent risk of being kicked out of the market.
South Korean Government Tightens Policies, Making it Difficult to Maintain Listed Status
The DAT trend was pioneered by MicroStrategy, with Japan's Metaplanet following suit in the capital markets. Korean DAT companies are essentially replicating the same playbook. Take BitPlanet as an example. This company was formed in July 2025 from the acquisition of KOSDAQ-listed company SGA by a consortium led by Asia Strategy and Sora Ventures. It currently holds 300 Bitcoin, with a long-term goal of accumulating 10,000 BTC. Its CEO, Lee Seong-hoon, publicly stated that the inspiration for the company's model came from MicroStrategy and Metaplanet.
The problem is that this "issue shares, raise funds, buy coins, stock price rises" flywheel is highly dependent on rising coin prices. Once the coin price reverses, these mostly small and medium-sized Korean DAT companies face not a financing hurdle, but the hurdle of "whether they can maintain their listed status."
According to The Herald Business, this reform comprehensively tightens four major delisting requirements, with the market capitalization threshold posing the greatest threat to DAT companies. The market capitalization standard for maintaining a KOSDAQ listing has been raised from the current 15 billion won to 20 billion won (over 13 million USD), and will jump again to 30 billion won next January.
The new system's evaluation mechanism is quite tight: If a stock's price stays below 1,000 won or its market capitalization stays below 20 billion won for 30 consecutive trading days, it will be designated as a "Caution" stock. After designation, there is a 90-trading-day recovery period. If it fails to meet the standards for 45 consecutive trading days during this period, it officially enters delisting procedures. Crucially, the stock price and market capitalization criteria must be met "simultaneously"; failure in just one of them is sufficient grounds for delisting.
At the same time, past "stock price manipulation tricks" used by companies are being blocked. Previously, when stock prices were too low and nearing the delisting line, companies could consolidate several shares into one, immediately boosting the price per share, though the company's overall value remained unchanged. The Herald Business explains that the new rules aim to close this loophole. For example, a company with a share price of 300 won, even if it consolidates shares to raise the price to 1,200 won, will still be listed for delisting review if the per-share value after conversion remains low. Furthermore, companies that have already conducted a consolidation or capital reduction within the past year, once placed on the watchlist, are not allowed to use the same trick again; even if allowed, the consolidation ratio cannot exceed 10 to 1.
Other requirements have also been tightened: The timing for checking whether a company's capital is fully eroded has expanded from reviewing only year-end financial reports to also reviewing semi-annual reports. The threshold for delisting penalty points accumulated due to false or irregular disclosures has been lowered from 15 points to 10 points, and a single major or intentional violation is enough to trigger review. After being placed under delisting review, the maximum improvement period a company can request has been shortened from 18 months to 1 year.
KOSDAQ's Own Weakness, Compounded by a Weakening Crypto Market
According to The Chosun Ilbo, delisting risk is no longer hypothetical. Many companies are currently in a situation of being temporarily "compliant but unsafe": Parataxis Ethereum's market cap is about 26.8 billion won, BitPlanet's is about 33.1 billion won — both above the 20 billion won threshold for the second half of the year. However, Parataxis Ethereum faces potential risks compared to the 30 billion won standard taking effect next January. The worst situation is Parataxis Korea, which was already placed under substantive listing eligibility review in April due to capital erosion, and its stock has been suspended. The Chosun Ilbo points out that if the market capitalization decline trend continues, these DAT companies may face delisting procedures starting with BitMax early next year.
Looking back, the direct trigger for this crisis was weakening coin prices. According to Bloomingbit, Bitcoin once broke through $120,000 in July last year, driven by the start of Donald Trump's second U.S. administration and pro-crypto policies. However, it has retreated since the U.S.-China trade friction became a turning point last October, falling to the low $50,000 range this month. With coin prices falling in both the first and second quarters of this year, DAT companies have had to book large-scale valuation losses on their books. The impact on stock prices during the earnings season could be even greater.
Making matters worse is KOSDAQ's own weakness. While the KOSPI has almost doubled this year (up about 95%), the KOSDAQ has actually declined about 10%. Capital has concentrated on KOSPI blue-chip stocks like Samsung Electronics and SK Hynix, marginalizing the KOSDAQ and the DAT companies within it. These companies have tried to fill funding gaps by issuing convertible bonds (CB) and preferred shares, but have been unable to withstand the overall decline in crypto asset prices.
KOSDAQ's overall weakness is evident in the numbers. The Herald Business reports that the KOSDAQ index fell from 945.57 at the beginning of January to 851.37 last Friday, a drop of nearly 10%, dragging down the market capitalization of its component stocks. As of last week, excluding SPACs and preferred stocks, the number of KOSDAQ companies with market capitalizations below 20 billion won reached 178, accounting for about 10% of the total 1,748 companies. This is a nearly threefold increase from 66 at the beginning of the year. There were also 180 "penny stocks" trading below 1,000 won, with a combined market capitalization of 6.14 trillion won.
The Herald Business also cited Korea Exchange data, indicating that all 39 KOSDAQ sectors closed lower in June (1st to 26th), with the KOSDAQ150 Industrial Materials sector leading the decline at -35.47%. Sectors like Finance (-32.63%), Technology-Listed Companies (-32.19%), and Transportation Equipment & Parts (-31.11%) also fell more than 30%.
Conclusion
For these ultra-small companies, the room for self-rescue through financial engineering is being compressed. The Herald Business cites industry views suggesting that the "market cap requirement" under the new system will be harder to meet than the "stock price requirement." A source at a KOSDAQ-listed company admitted that while penny stocks can at least be propped up through capital reduction without compensation or share consolidation, it's difficult to meet the market cap target without a substantial increase in stock price. Relying on M&A for a quick fix isn't easy either. As long as KOSDAQ's downturn continues, more and more companies will fail to meet the market capitalization threshold.
A representative example is Hyungji I&C. In March, it conducted a 10-to-1 capital reduction without compensation, raising its share price to nearly 4,000 won. However, its market cap remained around 10.6 billion won, far below the new threshold. This illustrates that even if the stock price temporarily meets the standard, the market cap hurdle remains insurmountable. The Chosun Ilbo also emphasized that the revised listing regulations include provisions "restricting capital reduction and share consolidation after being designated as a caution stock," making it more difficult for companies without substantial stock price recovery to continue lingering in the market.
A Korea Exchange official downplayed the impact, stating that a delisting wave would not immediately occur in July, as companies placed on the caution stock list still have an improvement period before moving to the next step. However, securities analysts' judgment is more pessimistic. Lee Jae-won, a researcher at Yuanta Securities Korea, said that the current environment is favorable for the KOSPI in terms of capital supply and demand, earnings, and interest rates. KOSDAQ's relative weakness is likely to persist until the return of individual capital and the confirmation of an earnings forecast rebound.
In other words, while the overall Korean stock market is riding high, this group of crypto-themed stocks flying the banner of "Korean Version MicroStrategy" finds itself at a critical juncture of survival, caught in a three-pronged attack from coin prices, market capital, and new regulatory rules.
