The South Korean government is taking steps to amend its Foreign Exchange Transactions Act in order to regulate virtual assets service providers (VASPs) involved in cross-border transactions. Under the proposed amendment, VASPs would be required to register under the new Act and submit monthly reports of individual users’ transaction details to the Bank of Korea.
The initiative, sponsored by National Assembly member Choi Eun-Seok from the People Power Party (PPP), aims to combat crypto-related money laundering and foreign exchange crimes in the country. Choi emphasizes the need for a monitoring system to track crypto transactions and believes that proper regulation and oversight of crypto and FinTech-based service providers will help curb illicit activities.
The Minister of Economy and Finance, Choi Sang-mok, has indicated that the proposed amendments will undergo consultations and legislative review, with a target implementation date set for 2025 pending approval. In the meantime, the Korean Financial Intelligence Unit (FIU) has reported a significant increase in suspicious transactions, prompting the Ministry of Economy and Finance to refine definitions of virtual assets and their merchants.
The proposed amendment reflects South Korea’s commitment to creating a more regulated crypto industry. The country is known for its efforts to establish an organized and well-monitored cryptocurrency ecosystem, striking a balance between regulation and innovation.
As the crypto industry continues to evolve, it is essential for stakeholders to stay informed and exercise caution. The information presented in this article is for informational and educational purposes only and should not be construed as financial advice. Readers are encouraged to conduct their own research and seek professional guidance before making any financial decisions.