South Korea’s crypto policy is evolving to balance innovation and regulation. The government has tightened oversight to curb fraud and money laundering, requiring crypto exchanges to register with the Financial Services Commission and comply with strict anti-money laundering rules. The Virtual Asset Users Protection Act, effective from mid-2024, mandates enhanced user fund protection and transparency in transactions. Meanwhile, South Korea is exploring a central bank digital currency (CBDC) to modernize its financial system. Despite a cautious approach, the government supports blockchain innovation, fostering startups through tax incentives and research grants. However, high-profile crypto scams have fueled public skepticism, prompting calls for stricter penalties. South Korea’s balanced policy aims to nurture a secure, innovative crypto ecosystem.
