South Korea Moves to Tighten Crypto Regulations with New Amendment

South Korea is working on amending its Foreign Exchange Transactions Act to require virtual asset service providers (VASPs) engaged in cross-border transactions to register and report user transaction details to the Bank of Korea.

Sponsored by Choi Eun-Seok of the ruling People Power Party, the amendment aims to combat crypto-related money laundering and foreign exchange crimes by improving transaction monitoring.

Choi believes that the lack of oversight has contributed to the rise in illegal activities and stresses the need for better regulation.

The bill, expected to be reviewed and potentially implemented in 2025, follows a report from the Korean Financial Intelligence Unit (FIU) showing a 48.8% increase in suspicious crypto transactions.

This proposal highlights South Korea’s effort to regulate the crypto market while encouraging innovation, with the government aiming for a balanced approach that addresses security concerns without stifling growth.