#SouthKoreaCryptoPolicy

South Korea is forging an increasingly structured cryptocurrency policy, seeking to balance innovation with investor protection and the prevention of money laundering. Although cryptocurrencies are not considered legal tender, the country has a very active retail market and a growing demand for institutionalization.

Key aspects of South Korean policy:

* Exchange regulation: Cryptocurrency exchanges must operate under a strict regulatory framework, including the obligation to use real-name bank accounts for transactions. This aims to ensure transparency and facilitate user identification.

* Focus on user protection: The "Virtual Asset User Protection Act," in effect since July 2024, imposes requirements on virtual asset service providers (VASPs) to protect user deposits and prevent unfair business practices. This includes the requirement for exchanges to maintain a significant percentage of client funds in "cold wallets".

* Anti-Money Laundering (AML/CTF): Anti-Money Laundering and Counter-Terrorism Financing regulations are mandatory for all VASPs, with strict "Know Your Customer" (KYC) requirements and the reporting of suspicious transactions.