#SouthKoreaCryptoPolicy

South Korea has been steadily progressing toward a mature and investor‑friendly cryptocurrency environment. In 2024, it introduced the Virtual Asset User Protection Act (VAUPA), requiring crypto exchanges to store at least 80% of customer funds in cold wallets, carry insurance, and enhance transparency—strong measures aimed at safeguarding investors . Starting mid‑2024, authorities also mandated monthly reporting of cross‑border crypto transactions, classifying virtual assets under enhanced foreign exchange regulations .

Moving into 2025, the People Power Party’s reform agenda seeks to dismantle the restrictive “one-exchange-one-bank” rule, expand institutional access, and green-light spot Bitcoin/Ethereum ETFs . A phased rollout is underway: in H1 2025, nonprofits and universities will be permitted to handle crypto donations and sell digital assets. Then, by H2 2025, approximately 3,500 institutions—including listed companies and professional investors—will gain entry via real-name accounts on exchanges, bolstered by anti‑money‑laundering guidelines .

Furthermore, new guidelines on institutional crypto investment are expected by Q3 2025, setting standards for corporate trading, custody practices, stablecoin oversight, and listing transparency . The Bank of Korea will also play a more prominent role, shaping stablecoin legislation to protect financial stability . Despite these rapid developments, a 20% tax on crypto profits has been delayed until 2028 to give markets time to adapt .

In summary, South Korea is pivoting from protective regulation toward expansive growth: reinforcing investor safety, opening up institutional markets, adapting to global norms, and innovating in asset classes and stablecoin policy. It’s positioning itself to be a regional leader in digital finance.