The Korea Fair Trade Commission's (KFTC) recent inquiry to 18 securities firms marks a critical turning point in its review of the merger between Dunamu and Naver Financial.
This isn't just a routine procedural step; it's a clear signal that the review has moved into a more focused phase. The KFTC is no longer just gathering general information. Instead, it is actively building a case around specific potential harms to competition, with the spotlight now firmly on the conditions for approval rather than a simple yes or no.
The KFTC's concerns are rooted in three main areas. First is the issue of data combination and self-preferencing. Naver has a history here, having been fined by the KFTC in 2020 for manipulating search algorithms to favor its own shopping and video services. This precedent makes the regulator particularly sensitive to how the merged entity might leverage its combined data from search, shopping, payments, unlisted stock trading, and crypto assets. The fear is that this could create an unassailable data advantage that locks users into their ecosystem and shuts out rivals.
Second, the existing market structure provides a strong basis for these concerns. Upbit, Dunamu's crypto exchange, already commands an estimated 72% of the domestic market share. Meanwhile, Naver Pay is a dominant force in the rapidly growing simple payment market, handling over 24 trillion won in the first quarter of 2026 alone. The KFTC is reasonably worried that combining these two giants could allow them to cross-promote services and bundle data in ways that severely weaken the ability of smaller fintech companies to compete.
Finally, the evolving regulatory environment for digital assets adds another layer of complexity. With discussions underway for a comprehensive Digital Asset Basic Act (DABA), which will cover stablecoins and ownership limits for exchanges, the KFTC is looking ahead. Its questions about stablecoins suggest it's preemptively examining how the merged company could become a dominant gatekeeper in future financial services, potentially controlling everything from payment to trading and asset issuance.
In essence, the narrative has shifted. The question is no longer whether the deal will be approved, but what behavioral and structural remedies will be imposed to preserve a level playing field in South Korea's digital economy.
- Glossary
- Self-preferencing: The practice of a platform operator using its market power to favor its own products or services over those of its competitors.
- Stablecoin: A type of cryptocurrency whose value is pegged to another asset, such as a fiat currency (e.g., the U.S. dollar) or a commodity, to maintain a stable price.
- Data Firewall: An internal policy or technical barrier that restricts the sharing of customer data between different business units of a company to prevent anti-competitive advantages.