South Korea is rapidly moving towards comprehensive regulation of the cryptocurrency sector, focusing on investor protection and enhancing transparency, without neglecting innovation and institutional experimentation. Starting from the second half of 2025, new regulations will be imposed to monitor cross-border digital transactions, requiring both local and international companies to register with the relevant authorities and submit detailed monthly reports to the Bank of Korea. This measure aims to reduce money laundering and financial crimes related to digital assets. In return, the government plans to gradually open the door for major institutions to participate in the market, allowing universities and non-profit organizations to invest in cryptocurrencies during the first half of 2025, followed by a pilot test involving more than 3,000 investment and professional institutions in the second half of the year. Among the most notable new precautionary measures are: requiring the storage of at least 80% of user assets in cold wallets, and mandating insurance for those assets to address any breaches or losses. The Legal Entity Identifier (LEI) will also be adopted to facilitate transaction tracking and distinguish business entities. Additionally, the Financial Intelligence Unit emphasized that any foreign platform providing services to Korean users without official registration will be considered illegal, which is a clear step towards regulating the local market.
