#SouthKoreaCryptoPolicy South Korea's Latest Crypto Policy Update – June 2025
South Korea has taken major steps to regulate and institutionalize the crypto sector with a clear focus on user protection, transparency, and institutional adoption. Here's a breakdown of the most recent developments:
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🛡️ 1. Virtual Asset User Protection Act (Effective July 2024)
This law is now fully enforced. Key highlights include:
80% of user funds must be stored in cold wallets.
Exchanges are required to maintain insurance or reserve funds to compensate users in case of hacks or system failures.
Stronger guidelines for consumer protection and fund security.
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👮♂️ 2. Crypto Crime Enforcement & AML
A joint crime investigation unit is operational, including the Financial Supervisory Service (FSS), Financial Services Commission (FSC), National Tax Service, and Customs.
Introduction of Legal Entity Identifiers (LEI) to track crypto transactions by institutions and business entities.
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🏢 3. Institutional & Corporate Participation
As of Q1 2025, non-profit organizations have been allowed to open real-name crypto accounts.
By Q3 2025, this will be extended to corporate and institutional investors, allowing broader and more regulated market participation.