#SouthKoreaCryptoPolicy

South Korea is tightening its crypto regulations to enhance investor protection and market grity. The *Virtual Asset User Protection Act (VAUPA)*, effective since July 19, 2024, mandates that exchanges store at least 80% of user assets in cold wallets and segregate user funds from company assets. It also requires real-time monitoring to detect and report suspicious activities.

Starting in the second half of 2025, businesses engaged in cross-border virtual asset transactions must register with authorities and report monthly to the Bank of Korea. This move aims to curb illicit activities, as over 11 trillion won in foreign exchange crimes have been linked to virtual assets since 2020.

Additionally, a *20% tax* on crypto gains exceeding 50 million KRW annually will be enforced from 2025. Institutions will also be permitted to sell crypto donations, and a pilot program will allow 3,500 corporations and professional investors to open real-name accounts on crypto exchanges.