South Korea’s financial authorities are moving to consolidate cryptocurrency exchange governance under a dedicated digital asset law and are considering granting fintech firms access to a new licensing regime for cross‑border virtual asset transfers.
The Financial Services Commission (FSC) has announced plans to transfer eligibility reviews for major shareholders of crypto exchanges from the existing Act on Reporting and Using Specified Financial Transaction Information to a forthcoming Digital Asset Basic Act. An amendment already set for August 20 broadens the scope of these reviews to include the largest shareholders and others with significant management influence. By relocating these rules into a single, industry‑specific legal framework, the FSC aims to eliminate the current patchwork of regulations, improve legal consistency, and strengthen investor protection without hampering innovation.
Simultaneously, the government is preparing to implement a new virtual asset transfer licensing system under the revised Foreign Exchange Transactions Act, which takes effect in December. The law brings cross‑border crypto transactions under formal foreign exchange oversight, requiring service providers to register with the Ministry of Economy and Finance and report transfers through the Bank of Korea’s reporting network. While the existing Virtual Asset Service Provider (VASP) regime largely limits registration to exchanges like Upbit and Bithumb, officials are reviewing whether fintech firms with the capability to handle such transfers should also be eligible. A Bank of Korea official noted that the business does not necessarily have to be restricted to current VASPs if other entities can perform the service, potentially creating new opportunities for blockchain‑based remittances and foreign exchange services under regulatory supervision.
The dual regulatory moves signal a maturing approach to crypto oversight in one of the world’s most active digital asset markets. By centralising exchange governance within a digital‑asset‑specific law and opening the door to fintech participation, South Korea is seeking to balance market integrity with industrial growth. The FSC is expected to release further guidelines, including a roadmap for tokenised securities, in the coming months.
