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South Korea to enforce reporting for cross-border crypto trades

South Korea to enforce reporting for cross-border crypto trades

GrafaGrafa2024/10/25 10:37
By:Isaac Francis

South Korea's Minister of Economy and Finance, Choi Sang-mok, announced plans to strengthen oversight on cross-border cryptocurrency transactions. 

At a recent G20 meeting in Washington, Choi outlined a new requirement for businesses handling these transactions to pre-register with authorities and report them monthly to the Bank of Korea. 

This effort aims to curb foreign exchange crimes involving digital assets, which accounted for approximately 88% of such offenses, totaling $1.2 billion. 

According to the announcement, the reported transaction data will be shared with tax, customs, financial, and international finance regulators to track and investigate illegal activities, such as money laundering and illegal arbitrage. 

The ministry plans to revise the Foreign Exchange Transactions Act to define "virtual assets" and "virtual asset business operators" as a new category. 

This distinction aims to establish a clear legal framework separate from traditional foreign exchange and capital transactions. 

Choi expects the legislative revisions to be completed by the first half of 2025, with the reporting and monitoring system slated for launch in the second half. 

The Ministry of Economy and Finance did not provide additional comments. 

South Korea has been progressively implementing regulations for its digital asset industry, with initial rules focusing on investor protection introduced in July 2024. 

The country is also working on follow-up regulations to set standards for crypto issuance, distribution, and disclosures. 

Moreover, South Korea's financial regulator is reevaluating the ban on local spot cryptocurrency exchange-traded funds (ETFs) and institutional accounts on exchanges, signaling an effort to expand its primarily retail-focused crypto sector. 

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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