South Korea’s Financial Intelligence Unit (FIU) proposed expanding the scope of the virtual asset Travel Rule to cover small-value transactions and suggested transaction restrictions on high-risk, unregistered virtual asset service providers (VASPs) at a Financial Action Task Force (FATF) plenary meeting.

According to ChainCatcher, the proposal was reported by Digital Asset and was framed as a response to rising money-laundering risks tied to cross-border digital asset transfers.

South Korea’s delegation said FATF member jurisdictions should apply the Travel Rule to both the remitter’s and recipient’s VASPs, and extend coverage to smaller transactions. Citing an increase in cases where criminal groups use overseas and unregistered VASPs, South Korea also called for stronger customer identity verification obligations and consideration of transaction limits for high-risk unregistered VASPs.

The FIU has previously advanced similar measures in a planned August revision to the Enforcement Decree of the Act on Reporting and Using Specified Financial Transaction Information, which would expand the Travel Rule’s application from transactions of 1 million won and above to transactions below 1 million won.