- South Korea is launching regulations for cross-border crypto transactions.
- The new law mandates pre-reporting and monthly report submission to the Bank of Korea.
- The Deputy Prime Minister emphasized the significance of such stringent laws in curbing illicit activities.
South Korea will soon regulate cross-border crypto transactions, with new rules taking effect in Q2 2025. These stricter regulations, which require pre-reporting of cross-border crypto transactions, aim to prevent tax evasion and illicit crypto trading. This move will bring greater transparency and oversight to the country’s crypto market.
Starting in Q2 2025, businesses handling cross-border transactions must submit monthly reports to the Bank of Korea. These companies will need to register with the authority in advance. Deputy Prime Minister Choi Sang-mok highlighted the importance of these strict regulations to curb illegal activities. Since 2020, South Korea has seen foreign exchange crimes totaling 11 trillion won ($7.97 billion), with cryptocurrencies involved in 81.3% of these crimes.
South Korea’s Evolving Crypto Regulations
South Korea has been actively working to regulate its crypto market and protect customers. In July 2024, the country introduced its first customer protection act, the Virtual Asset User Protection Act. This was followed by a series of regulations focused on investor security. To combat illegal crypto trading, South Korea has launched investigations into tokens like AVAIL and NFP for alleged price manipulation.
Read also: South Korea May Soon Allow Bitcoin Spot ETFs
More recently, FSS Governor Lee Bok-hyun discussed the country’s plan to take a free market approach to crypto. Addressing concerns about competitive crypto interest rates on exchanges like Bithumb, the Governor suggested that South Korea would adopt flexible regulations.
South Korea’s crypto regulatory development is a part of the global trend, where countries like India plan to ban virtual assets. Raising concerns over the increasing crypto threats, India has hinted at its potential ban on cryptocurrencies.
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Source: https://coinedition.com/south-korea-to-tighten-oversight-of-cross-border-crypto-transactions-starting-next-year/