South Korea has approved amendments that eliminate the ₩1 million threshold for the crypto Travel Rule, requiring all registered virtual-asset service providers (VASPs) to share sender and recipient information on every domestic transfer regardless of the amount. The decision, announced by the Financial Services Commission (FSC) on August 11, closes a structuring loophole that had been exploited to circumvent anti-money laundering (AML) controls.
The Financial Intelligence Unit (FIU) cited a specific enforcement case to justify the removal: one user deposited approximately 200 million won (around $141,000) into an exchange to purchase USDT, then executed 216 separate withdrawals, each below the previous 1 million won threshold. This “structuring” technique mirrored tactics long banned in traditional banking but had been technically legal under the prior crypto Travel Rule gap.
Under the revised framework, receiving platforms must obtain sender and recipient data for every transfer or reject the transaction. VASPs are also required to implement risk-based transfer policies for transactions involving overseas exchanges and personal wallets. For transfers of ₩10 million or more to foreign platforms or self-hosted wallets, mandatory suspicious-transaction monitoring will be triggered, and high-risk transactions must be blocked outright.
The changes will take effect in stages: strengthened VASP registration provisions begin on August 20, while the expanded Travel Rule and associated transfer requirements take effect six months after promulgation. Existing providers receive an additional year to meet certain financial and staffing standards, giving smaller operators time to build compliance infrastructure.
South Korea has separately urged the Financial Action Task Force (FATF) to remove all transaction thresholds globally, aligning with the EU’s zero-threshold standard and below FATF’s own $1,000 de minimis. Regulators will watch whether the new rules curb structured transfers or merely redirect activity to offshore platforms and personal wallets outside their jurisdiction.
