#SouthKoreaCryptoPolicy South Korea's cryptocurrency policy is focused on investor protection and market stability. The Virtual Asset User Protection Act, effective July 2024, requires crypto exchanges to¹:

- *Store at least 80% of user deposits in cold wallets*, separating user funds from the exchange's assets

- *Entrust user cash deposits to local licensed banks* and maintain cryptocurrency reserves equivalent to customer deposits

- *Implement real-time monitoring systems* to report suspicious transactions

- *Purchase adequate insurance or establish reserve funds* to address potential hacking incidents or liquidity crises

The Financial Services Commission (FSC) oversees the industry, enforcing strict regulations and considering spot cryptocurrency ETFs and corporate crypto accounts. A new crypto committee will shape digital asset regulations in 2025.²