South Korean regulatory authorities are considering implementing a "Short Selling Ban" to address the stock market's sharp decline.

BlockBeats News, July 30th, according to Yonhap News Agency, Korean exchanges recently examined the technical feasibility of a temporary short selling ban and narrowing the stock price fluctuation limit to evaluate emergency measures that can be used in the event of a sharp market decline. The related examination includes whether the system can execute the changes and the time required to complete the adjustments. However, sources emphasized that the current focus is only on confirming the technical feasibility, not on actual implementation.

The Korean exchanges also evaluated the possibility of further reducing the current 30% daily price fluctuation limit to restrict individual stock price drops during extreme market conditions. The Korean Ministry of Economy and Finance previously held an emergency market situation inspection meeting and stated that considering the high volatility of the Korean stock market compared to other countries and historical levels, they will maintain the highest state of alert and activate a joint 24-hour monitoring mechanism involving relevant departments.

With the continuous plunge of the Korean stock market, a temporary ban on short selling has become one of the main demands of retail investors. A related National Assembly petition has received support from approximately 10,000 people in just two days, and some lawmakers have suggested restarting the stock market stabilization fund. Korean brokerage analysts stated that amid the time needed for deleveraging single stock leveraged ETFs, a short selling ban may help control further declines.

However, the short selling ban may conflict with South Korea's goal of being included in the MSCI Developed Market Index. An official from the Korean exchange stated that they have not received any relevant government requests, have not formally studied the short selling ban, and such measures are not within the exchange's sole decision-making authority.