#SouthKoreaCryptoPolicy

1. Fundamental Legal Framework (VAUPA)

– The Act on the Protection of Virtual Asset Users (VAUPA) was approved on July 18, 2023, and officially comes into effect from July 19, 2024. This law requires:

• Exchanges to separate user assets (at least 80% cold storage, insured), maintain transaction records for a minimum of 15 years,

• Prohibits market manipulation and insider trading,

• Allows the Financial Services Commission (FSC) to conduct inspections, impose fines, and even prison sentences

2. Expansion for Organizations & Enterprises

– From 2025, the FSC will implement a pilot program to open “real-name” accounts for organizations such as funds, universities, and charities in the first half, followed by listed companies and professional investors in the second half of the year.

– Reuters (2024-10): International (cross-border) transactions must be registered and reported monthly to the Central Bank starting in the second half of 2025.

3. Supplementary Law: Phase 2

– Currently being drafted in the second half of 2025, focusing on:

• Increased transparency when listing tokens,

• Specific regulations for stablecoins,

• Internal rules, conflict of interest control, disclosure for VASP.