The South Korean crypto asset landscape is facing major changes due to the Korean Federation of Banks issuing real-name account operation guidelines, which require crypto exchanges to reserve a minimum of 3 billion Korean won (USD $2.3 million). This initiative is intended to protect users from potential issues such as system failures or cyberattacks.
Exchanges that facilitate transactions between fiat currency (won) and cryptocurrencies have made substantial progress in meeting the requirement, but coin market exchanges that handle coin-to-coin transactions are challenged by the capital needed to accumulate reserves. In addition to the reserve accumulation mandate, the guidelines also include provisions for customer authentication (KYC) and collection transfers that are set to come into effect in January.
Broader
Regulatory Landscape
In July, South Korea
implemented further guidelines for cryptocurrency companies, which require them to reveal details about their holdings, such as the amount of digital assets held and the characteristics of these assets. The People Power Party also adopted a bill in May that requires lawmakers to declare their crypto holdings.
Additionally, a Joint Investigation Centre for Crypto Crimes has been launched to protect investors and combat criminal activities in the crypto asset sector.
