Current Regulatory Sanctions and Investigations

The proposed merger between Dunamu (the operator of Upbit) and Naver Financial is currently facing significant regulatory headwinds due to sanctions and investigations by the Financial Supervisory Service (FSS) and the Financial Services Commission (FSC). While the deal remains active, these regulatory actions have delayed the closing date to December 31, 2026, and introduced new compliance requirements that may alter the final ownership structure [Source: https://cryptobriefing.com/dunamu-naver-financial-stock-swap-delay/].

Current Regulatory Sanctions and Investigations

Dunamu is navigating multiple regulatory challenges that directly impact its "fit and proper" status as a major corporate entity in South Korea:

• Hacking Sanctions (July 2026): The FSS recently initiated sanctions following a seven-month investigation into a November 2025 security breach. The hack resulted in the loss of 44.5 billion KRW (~$32M) in Solana-based assets. Regulators are specifically scrutinizing Upbit’s delayed disclosure of the event, which occurred only after merger-related proceedings with Naver had concluded for the day [Source: Web Search Result 1].
• AML/KYC Violations: In early 2025, the FSS proposed a 35.2 billion KRW (~$25M) fine for over 34,000 KYC (Know Your Customer) violations. Although a court partially overturned a three-month ban on new users in April 2026, the compliance record remains a hurdle for merger approval [Source: Web Search Result 1].
• Disclosure Correction Orders: On April 3, 2026, the FSS issued a formal correction order regarding Dunamu’s material disclosure reports, citing the omission of specific details regarding future corporate restructuring plans [Source: Web Search Result 1].

Merger Structure and Valuation

The deal is structured as a 100% stock swap, valuing the combined entity at approximately 20 trillion KRW (~$13.8 billion) [Source: https://www.bloomberg.com/news/articles/2025-11-26/naver-to-acquire-crypto-exchange-upbit-s-parent-dunamu].

Impact on the Merger Process

The sanctions and ongoing investigations have shifted the merger from a straightforward acquisition to a complex regulatory negotiation:

1. Timeline Delays: Originally slated for completion in mid-2026, the closing has been pushed back multiple times due to the FSS investigation and the need for "correction" in financial disclosures [Source: https://cryptobriefing.com/dunamu-naver-financial-stock-swap-delay/].
2. Antitrust and Monopoly Concerns: The Korea Fair Trade Commission (KFTC) has expressed concerns that the merger would create a monopoly, as Upbit holds over 70% of the domestic crypto trading volume. The security failures and sanctions provide regulators with additional leverage to demand structural concessions [Source: Web Search Result 1].
3. Voting Rights Concessions: To mitigate monopoly concerns, reports indicate Dunamu may be required to delegate over 50% of its voting rights to Naver, potentially diluting the founders' control despite their significant post-merger equity stakes [Source: Web Search Result 1].
4. Ownership Uncertainty: While the stock swap ratio is set, the final ownership percentages are contested. Some reports suggest founder Song Chi-hyung will hold roughly 19% of the combined entity, while total founder stakes are estimated near 30% [Source: https://phemex.com/news/article/dunamu-founders-become-billionaires-in-136b-naver-merger-41334].

Conclusion

The FSS sanctions have not killed the Upbit-Naver merger, but they have transformed it into a high-stakes compliance test. The primary impacts are extended delays and increased regulatory oversight that may force Dunamu to surrender significant voting power to satisfy the KFTC and FSC. The finalization of the deal now depends on Dunamu's ability to resolve the 2025 hacking penalties and satisfy the FSS's disclosure requirements by the end of 2026.