#SouthKoreaCryptoPolicy South Korea's crypto policy is governed by a strict regulatory framework that requires compliance with Know Your Customer (KYC) and Anti-Money Laundering (AML) guidelines. Here are the key aspects:

*Regulatory Framework:*

- The Financial Services Commission (FSC) oversees the crypto industry, supervising and enforcing regulations.

- The Act on the Protection of Virtual Asset Users (VAUPA) safeguards user assets, prevents unfair practices, and grants the FSC comprehensive oversight powers.

*Requirements for Crypto Exchanges:*

- *Registration*: Crypto exchanges must register with the FSC to operate legally.

- *Real-name Verification*: Exchanges need to collaborate with local banks for real-name verification accounts.

- *KYC and AML*: Exchanges must implement KYC and AML procedures to verify user identities and monitor transactions.

*Taxation:*

- A 20% tax on cryptocurrency profits exceeding 2.5 million won ($1,800) has been delayed until 2028 due to market volatility and infrastructure concerns.

*Other Key Aspects:*

- *ICOs*: Initial Coin Offerings are banned due to fraud and market manipulation concerns, but discussions are underway to potentially lift the ban with regulations.

- *STOs*: Security Token Offerings are viewed positively, with the government working on regulations to allow STOs under the Capital Markets Law.

- *Stablecoins*: President Lee Jae-myung's administration is expected to support the launch of a won-based stablecoin, with a focus on private sector innovation.¹ ²

*Recent Developments:*

- President Lee's administration is expected to accelerate crypto policy changes, including the enactment of the Digital Asset Basic Act (DABA).

- The Democratic Party's Digital Asset Committee aims to pass DABA through the National Assembly this year, proposing a self-regulatory body, stablecoin approval system, and clearer rules for crypto service providers.